Section 9B - Income on receipt of capital asset or stock in trade by partner/member from firm/AOP/BOI

• Where any partner/member receives any capital asset or stock in trade from firm/AOP/BOI at the time of dissolution or reconstitution of such firm/AOP/BOI, then capital gains or business income shall arise in the hands of firm/AOP/BOI in the year in which such capital asset or stock in trade was transferred.

• The Fair Market Value (FMV) of the capital asset or stock in trade as on the date of its receipt by the partner/member shall be the Full Value of Consideration (FVOC) for the purposes of computing capital gains or business income.

• Reconstitution here includes any of the following situations:

• one or more partners/members cease to be partner/member.

• one or more partners/members are admitted in the firm/AOP/BOI in a manner that one or more persons who were the partners of firm/AOP/BOI before the change, continue as partners or members after the change.

• all the partners or members of such firm/AOP/BOI continue with a change in their respective PSR.