Capital Gains Tax on Transfer of Depreciable Assets Without Asset Distribution Post-Partnership Firm reconstitution

PVR Tourist Home Vs CIT (Kerala High Court)

The Kerala High Court recently delivered a significant judgment in the case of PVR Tourist Home Vs CIT, addressing the applicability of capital gains tax on the transfer of depreciable assets. This ruling provides clarity on the interpretation of Sections 45(4) and 50 of the Income Tax Act, 1961, particularly in the context of partnership firms undergoing reconstitution. The case revolves around the tax implications of transferring a depreciable capital asset and whether such transactions attract capital gains tax under Section 45(4).

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