32. Computation of capital gains.-

32. Computation of capital gains.-

(1) The income under the head "Capital gains" shall be computed after making the following deduction from the full value of the consideration received or accruing from the transfer of the capital asset or the fair market value thereof, whichever is higher, namely:-

(a) any expenditure incurred solely in connection with the transfer of the capital asset; or

(b) the cost of acquisition of the capital asset and any capital expenditure incurred for any improvements thereto but excluding any expenditure in respect of which any allowance is admissible under any provisions of sections 23,29 and 34

1[(1A)]   No deduction in respect of cost of acquisition as contemplated in sub-section(1) shall be allowed for the purpose of computation of income under the head “Capital gains” on account of the transfer of any capital asset acquired by the assessee as a bonus share];

(2) For the purpose of this section, "cost of acquisition of the capital asset" means-

(i) where it was acquired by the assessee by purchase, the actual cost of acquisition; and

(ii) where it became the property of the assessee-

2[(a) by succession, inheritance or devolution; or];]

[(b) under a deed of gift, bequest or will; or];]

 3[(c) by succession, inheritance or devolution; or ];]

 4[(cc) under a deed of gift, bequest or will; or

(ccc) under a transfer on a revocable or irrevocable trust; or

(d) on any distribution of capital assets on the liquidation of a company; or     

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1 Ins. by F.A. 1995 and subsequently omitted by F.A. 1996
2 Omitted by F.O. 1986
3 Subs. by F.A. 1990 and subsequently omitted by F.A. 1993
4 Ins. by F.A. 1990

 

                                                                           

(e)   on any distribution of capital assets on the dissolution of a firm or other association of persons or the partition of a Hindu undivided family ;

the actual cost of acquisition to the previous owner of the capital asset as reduced by the amount of depreciation, if any, allowed to the previous owner; and where the actual cost of acquisition to the previous owner cannot be ascertained, the fair market value at the date on which the capital asset became the property of the previous owner:

Provided that where the capital asset is an asset in respect of which  the  assessee  has  obtained  depreciation  allowance  in any  year,  the  cost  of  acquisition  of  the  capital  asset  to  the assessee  shall  be  its  written  down  value  increased  or diminished,  as  the  case  may  be,  by  any  adjustment  made under section 19(16) or (17) or section 27 (1) (j) or section 29(1) (xi):


1[Provided  further  that  where  the  capital  asset  became  the property  of  the  assessee  by  succession,  inheritance  or devolution, the actual cost of acquisition of the capital asset to the assessee shall be the fair market value of the property prevailing at the time the assessee became the owner of such property.]

 (3) Where in the opinion of the Deputy Commissioner of Taxes the fair market value of a capital asset transferred by an assessee as on the date of transfer exceeds the full value of the consideration declared by the assessee by an amount of not less than fifteen per cent of the value so declared, the fair market value of the capital asset shall be determined with the previous approval of the Inspecting Joint Commissioner.

(4) Where in the opinion of the Deputy Commissioner of Taxes the fair market value of a capital asset transferred by an assessee as on the date of the transfer exceeds the declared value thereof by more than twenty five per cent of such declared value, the Government may offer to buy the said asset in such manner as may be prescribed.

(5) Notwithstanding anything contained in this section or section 31, where a capital gain arises from the transfer of a capital asset which immediately before the date on which the transfer took place was being

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1 Ins. by F.O. 1986, subsequently omitted by F.A. 1990 and restored by F.A. 1993

 

 

used by the assessee for the purposes of his business or profession and the assessee has, within a period of one year before or after that date, purchased a new capital asset for the 1[same] purposes of his business or profession, then, instead of the capital gain being charged to tax as income of the income year in which the transfer took place, it shall, if the assessee so elects in writing before the assessment is made, be dealt with in accordance with the following provisions of this sub-section, that is to say-

(a) if the amount of the capital gains is greater than the cost of acquisition of the new asset,-

(i) the difference between the amount of the capital gain and the cost of acquisition of the new asset shall be charged under section 31 as income of the income year, and

(ii) for the purposes of computing in respect of the new asset any allowance under the Third Schedule or the amount of any capital gain arising from its value, as the case may be, shall be nil, or

(b) if the amount of the capital gain is equal to or less than the cost of acquisition of the new asset,-

(i) the capital gain shall not be charged under section 31, and

(ii)  for the purposes of computing in respect of the new asset any allowance under the Third Schedule or any income under section 19(16) or the amount of any capital gain arising from its transfer, the cost of acquisition or the written down value, as the case may be, shall be reduced by the amount of the capital gain:

Provided that where in respect of the purchase of a new capital asset consisting of plant or machinery, the assessee satisfies the Deputy Commissioner of Taxes that despite the exercise of due diligence it has not been possible to make the purchase within the period specified in this sub-section, the Deputy Commissioner of Taxes may, with the prior approval of the Inspecting Joint Commissioner, extend the said period to such date as he considers reasonable.

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1Omitted by F.A. 1995

 

 

1[(6) Notwithstanding anything contained in this section or section 31, where a capital asset being buildings or lands appurtenant thereto the income of which is chargeable under the head “Income from house property”, which in the two years immediately preceding the date on which the transfer took place was being used for the purpose of residence, and the assessee has within a period of one year before or after that date purchased, or has within a period of one year before or after that date purchased, or has within a period of two years after that date constructed, a house property for the purpose of residence then instead of the capital gain being charged to tax as income of the income year in which the transfer took place, it shall, if the assessee so elects in writing before the assessment is made, be dealt with in accordance with the following provisions of this sub-section, that is to say-

(a) if the amount of the capital gains is greater than the cost of acquisition of the new asset—

      (i) the difference between the amount of the capital gain charged under section 31 as income of the 2[income year],and

      (ii) for the purpose of computing in respect of the new asset any capital gain arising from its transfer, the cost of acquisition shall be nil,

 

(b) if the amount of the capital gain is equal to or less than the cost of acquisition of the new asset,--

      (i) the capital gain shall not be charged under section 31,and

      (ii) for the purpose of computing in respect of the new asset any capital gain arising from its transfer, the cost of acquisition shall be reduced by the amount of the capital gain:

Provided that where in respect of the purchase or construction of a new capital asset consisting of building for the purpose of residence ,the assessee satisfies the Deputy Commissioner of Taxes that despite the exercise of due diligence it has not been possible to make the purchase or construction within the period specified in this sub-section, the Deputy Commissioner of Taxes may, with the prior approval of the Inspecting Joint Commissioner , extend the said period to such date as he considers reasonable.].

3[(7) Notwithstanding anything contained in this section or section 31, where a capital gain arises from the transfer of a capital asset being Government securities and 4[and stocks and shares of public companies listed with a stock exchange in Bangladesh], 5[other that bonus share of a company] then no tax shall be charged under this section 31.

6[(8)  Notwithstanding anything contained in this section or section 31 where a capital gain arises from the transfer of a capital asset being buildings or lands which, within a period of two years immediately following the date on which the transfer took place, is invested in the acquisition of capital asset of an industrial undertaking,7[or in the acquisition of a new apartment or apartments to be used for residence under an agreement used for residence] 8[or purchase of new shares of a company listed with a Stock Exchange in Bangladesh or purchase of National writing before the assessment is made, be dealt with in accordance with the following provisions of this sub-section, that is to say-

(a) if the amount of the capital gains is greater than the cost of acquisition of the new asset—            

 (i) the difference between the amount of the capital gain and the cost of acquisition of the new asset shall be charged under section 31 as income of the income year, and

(ii) for the purposes of computing in respect of the new asset, any allowance under the Third Schedule or the amount of any capital gains arising from its transfer, the cost of acquisition the written down value, as the case may be, shall be nil, or                  

 (b) if the amount of the capital gain is equal to or less than the cost of acquisition of the new asset,--

  (i) the capital gain shall not be charged under section 31, and

(ii) for the purposes of computing in respect of the new asset any allowance under the Third Schedule or any income under section 19( 16) or the amount of any capital gain arising from its transfer, the cost of acquisition or the written down value, as the case may be, shall be reduced by the amount of the capital gain:

 9[Provided that where in respect of the acquisition of the capital asset on an industrial undertaking, the assessee satisfies the Deputy Commissioner of Taxes that despite the exercise of due diligence it has not been possible to acquire the new asset within the period specified in this sub-section, the Deputy Commissioner of taxes may, with the prior approval of the Inspecting Joint Commissioner, extend the said period to such date as he considers reasonable]. ]

 10[11[(9) Notwithstanding anything contained in this section or section 31, where a capital gain arises from the transfer of a capital asset being buildings or lands which, within a period of one year immediately following the date on which the transfer took place, 12[is invested in the acquisition, otherwise than by purchase, or transfer from previous holders, of stocks or shares of public limited companies listed with a stock exchange in Bangladesh] and the stocks or shares are held by the assessee for at least two years from the date of acquisition, the capital gain shall not be charged to tax as income of the year in which the transfer took place.].

(10) Notwithstanding anything contained in this section or section 31, where a capital gain arises from the transfer of capital being buildings or lands to a new company registered under  13[the Companies Act, 1913 (VII of 1913) or কোম্পানী আ‌ইন, 1994 (1994 সনের 18 নং আ‌ইন)], for setting up of an industry, and if the whole amount of capital gain is invested in the equity of the said company, then the capital gain shall not be charged to tax as income of the year in which the transfer took place.

(11) Notwithstanding anything contained in this section or section 31, where a capital gain arises from the transfer of capital asset of a firm to a new company registered under 14[the Companies Act, 1913 (VII of 1913) or কোম্পানী আ‌ইন, 1994 (1994 সনের 18 নং আইন), and if the whole amount of the capital gain is invested in theequity of the said company by the partners of the said firm, then the capital gain shall not be charged to tax as income of the year in which the transfer took place.

15[16[(11A)    Notwithstanding anything contained in this section or section 31, where a capital gain arises from the transfer of capital asset of an assessee to a new company registered under . †Kv¤úvbx AvBb, 1994 (1994 m‡bi 18bs AvBb), and if the whole amount of the capital gain is invested in the equity of the said company, then the capital gain shall not be charged to tax as income of the year in which the transfer took place:

Provided that for determining the capital gains arising from the transfer of stocks or shares of the said company, actual cost of acquisition of membership of a Stock Exchange in proportion to the stocks or shares shall be deducted from the full value of the consideration received or accruing from the transfer of stocks or shares or the fair market value thereof, whichever is higher .”] ]

17[(12) Notwithstanding anything contained in sub-sections 18[(5), (7), (10), and (11)], no exemption shall be allowed to any person on so much of profits and gains arising out of the transfer of a capital asset as is attributable to the cost of acquisition of such asset in respect of which any investment allowance referred to in paragraph 1, 2, 3, 4, 5, 6, 8, 9, 10 and 11 of PART B of the SIXTH SCHEDULE to this Ordinance was at any time allowed.

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1Omitted by F.A. 2000
2 Subs. for "previous year" by F.o. 1985

3 Subs by F. A. 1995
4 Omitted by F.A. 2010
5 Omitted by F.A.1996

6 Omitted by F.A. 2010

7 Ins by F. A. 1991

8 Ins by F. A. 1993

9 Proviso omitted by F. A. 1993


10 Ins. Sub-section (9), (10) and (11) by F.O.1985

11 Omitted by F.A. 2000

12 Subs. for "in the aqisition of stocks or share of public limited companies which fulfill the conditions laid down in paragraph 8 of part B of Sixth Scheedule" by F. A. 1995

13 Subs. for "the Companies Act. 1913 (VII of 1913)" by F.A. 1995
14 Subs. for "the Companies Act. 1913 (VII of 1913)" by F.A. 1995

15 Omitted by F.O. 2007

16 Ins. by F. A. 2006

17 Ins. by F.A. 1994
18 Subs. for "sub-sections (5), (6), (7), (8), (9),(10) and (11)" by F.A. 2000

 

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