Withdrawal of exemption: conversion or change in shareholding triggers capital gains taxation. If a capital asset transferred under section 47 is converted into or treated as stock in trade by the transferee, or if the parent/holding company ceases to hold the whole share capital of the subsidiary within the prescribed period, the profits or gains not charged by virtue of section 47 are deemed to be income chargeable under the head Capital gains in the previous year in which the transfer took place. Non compliance with proviso conditions to specified clauses of section 47 results in previously exempted gains being treated as taxable profits of the successor or appropriate taxpayer in the year of such non compliance.