I understand when CA converted into SIT is taxable under the head Capital gain only. If SIT converted into CA, it is going to taxable under the head PGBP. Whenever this CA sold, is it going to tax in Capital gain again ? Because of taxed under pgbp earlier, is that why we take Cost of Acquisition under Capital gain as FMV on the date of transfer ?
If CA converted to SIT -Treatment Capital Gain=FMV(conversion)- COA/ICOA Business Income=Sale consideration - FMV of asset(on conversion) If SIT converted to CA-Treatment Capital Gain-Full value of consideration - FMV on (conversion) Business Income-FMV(conversion) so there is no double taxation, as you see above wat ever income chargeable to tax in one head it will be deducted while computing other.