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COMPARISON BETWEEN SECTION 112 AND SECTION 112A OF INCOME TAX ACT
- Long term capital gains under these two sections cover:
- Equity share in a company
- Unit of Equity Oriented Fund
- Unit of a business trust
- First proviso in both the sections relate to the benefit of slab rate in case of Individual and HUF, being resident.
- Deductions under Chapter-VIA are not available in both sections.
- Both sections have one common tax rate @ 10%.
Difference between section 112 and section 112A:
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Particulars |
Section 112 |
Section 112A |
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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 |
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Tax Rate |
Tax Rate @ 20% or 10% |
Tax Rate only @ 10% in excess of Rs. 1 lakh. |
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Exemption of Rs. 1 lakh |
NO |
YES |
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Applicability |
Inserted by Finance Act, 1992 |
Inserted by Finance Act, 2018. Applicable w.e.f. 01-04-2019 |
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Relief u/s 87A |
YES |
No |
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Mode of Computation of Capital Gain in foreign currency in case of NR (1st proviso to Section 48) |
YES |
NO |
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Indexation benefit as per 2nd proviso to Section 48 |
YES |
No |
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Condition of payment of STT |
Applies on transfer of LTCA whether STT is paid or not. |
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