Exemption u/s 54GA - Capital Gains - Transfer of Industrial Undertaking from Urban Area to SEZ

• Section 54GA of the Income Tax Act 1961 prescribes provisions relating to exemption on transfer of Land/Building/Plant & Machinery from Urban area to any Special Economic Zone (SEZ).

• This exemption is available to all assessees.

• The capital gain on transfer of Land/Building/Plant & Machinery can be short term or long term in nature.

• The asset to be acquired to avail exemption under this section shall be Land/Building/Plant & Machinery of an industrial undertaking in a SEZ and associated shifting expenses.

• Time Limit: The new asset should be acquired within 1 year before or 3 years after the date of transfer of original asset.

• Amount of exemption: The amount of exemption that can be claimed shall be lower of capital gain amount or the cost of new asset/amount deposited in CGAS till the due date of filing return of income. 

• The provisions relating to CGAS Scheme and Lock in period are are the same as prescribed under section 54 of the Act.