Section 87(1)(b) in The Income Tax Act, 2025

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Union of India - Subsection

Section 87(1)(b) in The Income Tax Act, 2025

(b)within one year before or three years after the date of such transfer,—

(i)purchased new machinery or plant for business of the industrial undertaking in the new area;

(ii)acquired building or land or constructed building for his business in the said area;

(iii)shifted the original asset and transferred the establishment of such undertaking to such area; and

(iv)incurred expenses on such other purpose as specified in a scheme notified by the Central Government for this section, then, instead of the capital gains being charged to income-tax as income of the tax year in which the transfer took place, it shall be dealt with as follows:—

(A)if the cost and expenses incurred on all or any of the purposes mentioned in sub-clauses (i) to (iv) referred to as "new asset",––

(I)is less than the capital gains, the difference shall be charged under section 67 as the income of the tax year; or

(II)is equal to or more than the capital gain, no capital gain shall be charged under section 67; and

(B)for computing any capital gain arising from transfer of the new asset within three years of its being purchased, acquired, in case of constructed or transferred, the cost shall be nil sub-clause(A)(II) or shall be reduced by the amount of the capital gain in case of sub-clause (A)(I).

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Union of India - Subsection

Section 87(1)(b) in The Income Tax Act, 2025