As per the Income-tax Law, gain arising on transfer of capital asset is charged to tax under the head “Capital gains”. What constitutes ‘transfer’ as per Income-tax Law?

Generally, transfer means sale, however, for the purpose of Income-tax Law "Transfer”,   in relation to a capital asset, includes:

i.  Sale, exchange or relinquishment of the asset;

ii.  Extinguishment of any rights in relation to a capital asset;

iii.  Compulsory acquisition of an asset;

iv. Conversion of capital asset into stock-in-trade;

v. Maturity or redemption of a zero coupon bond;

vi.  Allowing possession of immovable properties to the buyer in part performance of the contract;

vii.  Any transaction which has the effect of transferring an (or enabling the enjoyment of) immovable property; or

viii.  Disposing of or parting with an asset or any interest therein or creating any interest in any asset in any manner whatsoever.