Where the company is permitted by its memorandum/articles of association to make a gift, transfer of shares by way of gift are valid, permissible and genuine and there is no requirement of a gift deed. Such gifts are exempt as per S. 47(iii) of the Act. Followed Prakriya Pharmacem v ITO (2016) 238 Taxman 185 ( Guj) (HC). Income chargeable under capital gains tax can not be assessed as income from other sources. (AY.2012-13)
Jayneer infrapower & Multiventures (P.) Ltd. v. DCIT (2019) 176 ITD 15 / 200 TTJ 179(Mum.)(Trib.)
S. 47 (iii) : Capital gains-Transaction not regarded as transfer–Gift -Transfer of shares made as gift without consideration are not taxable under provisions of capital gains-Income chargeable under capital gains tax cannot be assessed as income from other sources. [S. 45]