CA Sukrati Agrawal

Similarity between Section 112 and Section 112A of Income Tax Act, 1961

1. Both sections covers following Long Term Capital Asset:-

  • Equity share in a company
  • Unit of Equity Oriented Fund
  • Unit of a business trust

2. Both sections determine tax on long term capital gains and falls under chapter XII of the Income Tax Act, 1961.

3. First proviso in both the sections is same which is related to benefit of slab rate in case of Individual and HUF,  being a resident.

4. Deductions under Chapter-VIA are not available in both sections.

5. Both sections have one common tax rate @ 10% subject to fulfilment of conditions specified therein.

Difference between Section 112 and Section 112A of Income Tax Act, 1961

S.No. Particulars Section 112 Section 112A
1. What type of LTCA covers? Applies to transfer of all Long Term Capital Assets defined as per section 2(29A) of the Act. Applies to transfer of only following Long Term Capital Assets:-

  • Equity share in a company
  • Unit of Equity Oriented Fund
  • Unit of a business trust
2. Condition of payment of STT Applies on transfer of LTCA whether STT is paid or not. Applies only when following conditions are satisfied:-
On Acquisition On Transfer
Equity share in a company Yes Yes
Unit of Equity Oriented Fund No Yes
Unit of a business trust No Yes
However, above conditions are not applicable if transfer covers under sub-section (3) or (4).
3. Tax Rate Tax Rate @ 20% or 10% Tax Rate only @ 10% in excess of Rs. 1 lakh.
4. Exemption of Rs. 1 lakh No Yes
5. Applicability Inserted by Finance Act, 1992 Inserted by Finance Act, 2018. Applicable w.e.f. 01-04-2019
6. Relief u/s 87A Yes No
7. Indexation benefit as per 2nd proviso to Section 48 Yes No
8. Mode of Computation of Capital Gain in foreign currency in case of NR (1st proviso to Section 48) Yes No

Author Bio

Qualification: CA in Job / Business
Company: N/A
Location: Noida, Uttar Pradesh, IN
Member Since: 27 May 2019 | Total Posts: 1

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  1. Ramanathan says:

    there seems to be no provision in ITTR 2 for giving consolidated figures of LTG, if there is no grandfathering involved.
    do we need to fill in details of all transactions in schedule 112A? irrespective whether grandfathering is applicable. there seems to be a contradiction between the recent CBDT clarification and the ITR 2 form
    pl clarify

    1. Sukrati says:

      Yes, my opinion is also same. In ITR 2 form right now there is no additional column for gain wherein there is no grandfathering. We should wait for instructions to fill ITR form.

    2. Dharmarajan Narayanan says:

      I have filled it up in B3 – 112 (1). Not sure if it is correct. However as indicated by you there is no provision to fill it up elsewhere.

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October 2020