Substitution of new sections for sections 114 and 115
Tax on Capital gains in case of assessees other than companies
11. For sections 114 and 115 of the Income-tax Act, the following sections shall be substituted, namely: -
\"114. Where the total income of an assessee, not being a company, includes any income chargeable under the head ‘Capital gains‘, the tax payable by him on his total income shall be-
(a) the amount of income-tax and super-tax payable on the total income as reduced by the amount of such inclusion ,and by the amount of compensation or other payment, if any, referred to in clause (ii) of section 28, had the total income so reduced been his total income; plus
(b) (i) the amount of income-tax and super-tax calculated on the amount of the net capital gains relating to short-term capital assets, if any, included in the total income at the average rate of income-tax and the average rate of super-tax respectively, which would have been applicable to the total income if the amount of the net capital gains, if any, relating to capital assets other than short-term capital assets and the amount of compensation or other payment aforesaid, if any, had not formed pert of it; plus
(ii) the amount of income-tax and super-tax calculated on the amount of the net capital gains, if any, relating to capital assets other than short-term capital assets, at the average rate of income-tax and the average rate of super-tax respectively, which would have been applicable to the total income, if the net capital gains, if any, relating to short-term capital assets and the amount of compensation or other payment aforesaid, if any, had not formed part of it; or the amount of income-tax calculated at the rate of 25 per cent, on the amount of the net capital gains relating to capital assets other than short-term capital assets included in the total income, whichever is less:
Provided that-
(i) where the total income does not exceed the sum of ten thousand rupees, the amount payable under sub-clause (ii) of clause (b) shall be nil; and
(ii) in no ease shall the amount payable under sub-clause (ii) of clause (b) exceed one-half of the amount, if any, by which the amount of capital gains relating to capital assets other than short-term capital assets exceeds the sum of five thousand rupees; plus
(c) the tax on such compensation or other payment aforesaid, if any, computed in accordance with the provisions of clause (iii) of section 112.
Tax on capital gains in case of companies
115. Where the total income of a company includes any income chargeable under the head ‘Capital gains‘ (whether such gains relate to short-term capital assets or to other capital assets), the tax payable by it shall be-
(a) the amount of income-tax with which it is charge able on its total income;
(b) the amount of super-tax equal to the aggregate of the amount of super-tax calculated at the rate of five per cent, on the amount of the capital gains relating to capital assets other than short-term capital assets included in the total income and the amount of super-tax with which it would be chargeable had its total income been reduced by the amount of such aforesaid capital gains.\".
[Finance (No. 2) Act, 1962]
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