Capital Gains Tax Exemptions: Clause 70 of the Income Tax Bill 2025 vs. Section 47 of the Income Tax Act 1961

Capital gains exemptions for specified restructurings preserve tax neutrality and facilitate cross-border and corporate reorganisations.

Clause 70 of the Income Tax Bill, 2025 designates specified classes of transactions as not regarded as transfer for capital gains purposes, exempting partitions of Hindu undivided families, transfers by will, gift or irrevocable trust, transfers between parent and subsidiary companies, amalgamations and demergers (including foreign company reorganisations), conversions and exchanges of securities, securities lending, reverse mortgage arrangements, mutual fund consolidations, transfers involving art and cultural institutions, and succession of business entities, thereby aligning with and expanding the scope of existing non-transfer provisions in Section 47 of the 1961 Act.