Sale of partnership, taxable as capital gain

 The Supreme Court held that the taxpayer, a partner, was liable for capital gains tax on the sale of the partnership because the partnership’s assets were “capital assets” as defined by a provision of India’s tax law. The high court observed that sale of a partnership as a “going concern” could be treated as “slump sale” only if there were no values assigned to the separate assets and liabilities. However, in the taxpayer’s case, value was not only assigned to the assets, but even the liabilities were addressed when the amount of sale was apportioned among the outgoing partners. There was a specific and separate valuation for land as well as building and also machinery. The case is: Vatsala Shenoy. Read an October 2016 report [PDF 339 KB] OF KPMG