Amendment of section 55

Section 14 of the Finance Act, 1964 deals with amendment of section 55. Amendment of section 55 14. In section 55 of the Income-tax Act, in sub-section (2), after clause (iii), the following clauses shall be inserted, namely: — ‘(iv) where the capital asset, being a share of a company, was allotted to the assessee by way of bonus and the assessee is chargeable to income

Amendment of section 55

14. In section 55 of the Income-tax Act, in sub-section (2), after clause (iii), the following clauses shall be inserted, namely: —

‘(iv) where the capital asset, being a share of a company, was allotted to the assessee by way of bonus and the assessee is chargeable to income-tax under the head "Capital gains" in respect of such share under sub-section (2) of section 45 and such asset is transferred after the expiry of thirty days referred to in that sub-section, means the fair market value of the asset on the date next following the expiry of the said thirty days;

(v) where the capital asset, being a share or a stock of company, became the property of the assessee on—

(a) the consolidation and division of all or any of the share capital of the company into shares of larger amount than its existing shares,

(b) the conversion of any shares of the company into stock,

(c) the reconversion of any stock of the company into shares,

(d) the sub-division of any of the shares of the company into shares of smaller amount, or

(e) the conversion of one kind of shares of the company into another kind, means the cost of acquisition of the asset calculated with reference to the cost of acquisition of the shares or stock from which such asset is derived.‘.

[Finance Act, 1964]

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Section 14, The Finance Act, 1964 (Act 5 of 1964).