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CA Vishnu Ram
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  1. CA Vishnu Ram Enlightened

    Difference between Section 112 and Section 112A of Income Tax Act, 1961 1. Both sections cover the following Long Term Capital Asset:- Equity share in a company Unit of Equity Oriented Fund Unit of a business trust 2. Both the sections are related to tax on long-term capital and charged @ 10% subjecRead more

    Difference between Section 112 and Section 112A of Income Tax Act, 1961

    1. Both sections cover the following Long Term Capital Asset:-

    • Equity share in a company
    • Unit of Equity Oriented Fund
    • Unit of a business trust

    2. Both the sections are related to tax on long-term capital and charged @ 10% subject to fulfilment of conditions specified therein.

    S.No. Particulars Section 112 Section 112A
    1. What type of LTCA covers? Applies to transfer of all Long Term Capital Assets defined as per section 2(29A) of the Act. Applies to transfer of only following Long Term Capital Assets:- 

    • Equity share in a company
    • Unit of Equity Oriented Fund
    • Unit of a business trust
    2. Condition of payment of STT Applies on transfer of LTCA whether STT is paid or not. Applies only when following conditions are satisfied:-
    LTCA STT Paid
    On Acquisition On Transfer
    Equity share in a company Yes Yes
    Unit of Equity Oriented Fund No Yes
    Unit of a business trust No Yes
    However, above conditions are not applicable if transfer covers under sub-section (3) or (4).
    3. Tax Rate Tax Rate @ 20% or 10% Tax Rate only @ 10% in excess of Rs. 1 lakh.
    4. Exemption of Rs. 1 lakh No Yes
    5. Applicability Inserted by Finance Act, 1992 Inserted by Finance Act, 2018. Applicable w.e.f. 01-04-2019
    6. Relief u/s 87A Yes No
    7. Indexation benefit as per 2nd proviso to Section 48 Yes No
    8. Mode of Computation of Capital Gain in foreign currency in case of NR (1st proviso to Section 48) Yes No

     

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