Comparison of Section 73 "Cost with reference to certain modes of acquisition" between the Income-Tax Act, 2025 (as passed) and the Income-Tax Bill, 2025 (as originally introduced)

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....ion date: Not stated in the document. Background & Scope Statutory hook: Clause 73 of the Income Tax Bill, 2025. The clause prescribes deemed cost of acquisition for capital assets that become the property of an assessee by various modes (gift, succession, liquidation distribution, trust transfers, specified transfers u/s 70(1) variants, demerger, consolidation of mutual funds, conversion in LLP, etc.). The clause sets out a Table with 24 serial entries mapping specific acquisition scenarios (column B) to the deemed cost of acquisition (column C). Definitions/explanations within the clause: Sub-section (2) defines "previous owner of the property" for serial number 1; it adopts SEBI Circular definitions for "main portfolio", "segregated p....

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....s declared under a prior disclosure scheme), fair market value is adopted as the relevant cost. Legislative intent suggested by text: to ensure tax neutrality in non-market transfers by preserving the prior owner's cost base (or substituting an objective market value where appropriate), and to provide clear mechanical rules for corporate reorganisations and fund restructurings. (Legislative history or policy rationale beyond the text: Not stated in the document.) Exceptions/Provisos No separate provisos are present beyond the Table and sub-section (2) clarifications. Specific carve-outs are embedded in entries (e.g., some entries only apply to shares of amalgamating companies, or to specified securities referred to in a particular se....

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....ites section 17(2); Act (Section 73) cites section 17(1)(d). * Practical impact: The amendment in the Act changes the statutory anchor for which category of specified securities or sweat equity shares the deemed cost rule applies. This can affect which instruments are valued at fair market value for cost purposes. (Precise reach of the change: Not stated in the document.) * Exclusion in entry regarding shares in a project (Table entry 20): Bill refers to "Capital asset, being share in the project, in the form of land or building, or both, u/s 67(14)"; Act adds the qualification "not being a capital asset referred to in section 67(16)". * Practical impact: The Act narrows the entry by excluding assets covered by section 67(16), thereby....

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....l uses shorter phrasing ("The cost of acquisition as reduced by..."; "As reduced by..."); Act uses fuller phrasing ("The cost of acquisition of such original units as reduced by..." and "The cost of acquisition of such original shares as reduced by..."). * Practical impact: Primarily stylistic; the Act's phrasing is marginally clearer on subject of reduction being applied to the cost of acquisition of the original asset. * Cross-reference to cooperative bank business reorganisation (sub-section (2)(d)): Bill refers to section 65; Act refers to section 64. * Practical impact: The Act alters which section governs application "as far as may be" to co-operative bank reorganisations. This may change whether the listed rules apply to su....