No Indexation if the assets sold before 01 June 2016 out of Undisclosed Income under IDS 2016

Central Board of Direct Taxes, Ministry of Finance vide clarification number 9 dated 27th September, 2016 clarifies about the assets so purchased out of undisclosed income before and sold before 01 June, 2016. That assessee will not get the benefit of indexation on this as the asset so purchased is also from the undisclosed income so the benefit of indexation will not be provide to the assessees. Instead department will assume the fair market value of the asset as on 01 June, 2016.


The Board reiterates the provisions contained in section 183(2) of the Scheme that where the income chargeable to tax is represented in the form of investment in any asset, the fair market value of such asset as on 01.06.2016 shall be deemed to be the undisclosed income for the purposes of the Scheme. In this context, it may be noted that cash in hand is an asset for the purposes of the Scheme.


Copy of Clarification