Capital Gain - Meaning of Transfer (Section 2(47))

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In relation to a Transfer, includes:

i) Sale, exchange or relinquishment of a capital asset; or

ii) Extinguishment of any rights therein; or

iii) Compulsory acquisition of a capital asset under any law; or

iv) Conversion or treatment of a capital asset into/as stock-in-trade; or

v) The maturity or redemption of a zero coupon bond; or

vi) Any transaction involving the allowing of the possession of any immovable property to be taken or retained in part performance of a contract of the nature referred to in Sec. 53A of the Transfer of Property Act, 1882; or

vii) Any transaction whether by way of acquiring shares in or by way of becoming a member of a co-operative society, company or other association of persons or by way of any agreement or arrangement or in any other manner which has the effect of transferring, or enabling the enjoyment of any immovable property.

  • The expression “transfer” includes disposing of or parting with an asset or any interest therein, or creating any interest in any asset in any manner whatsoever, directly or indirectly, absolutely or conditionally, voluntarily or involuntarily, by way of an agreement (whether entered into in India or outside India) or otherwise, notwithstanding that such transfer of rights has been characterized as being effected or dependent upon or flowing from the transfer of a share or shares of a company registered or incorporated outside India – Explanation 2 to Sec. 2(47) .
  • Relinquishment: Relinquishment means withdrawn from, abandoning or giving up anything. Where an assessee gives up the right to claim specific performance for purchase of immovable property, it is relinquishment of a capital-asset.
  • Extinguishment of any rights in an asset: It means total destruction, annihilation, termination or extinction of a capital asset. It refers to extinguishment of rights on account of transfer.



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