Govt notifies capital asset transfer from Air India to AIAHL, exempts tax provisions for divestment

The government has notified the transfer of capital assets from Air India to Air India Asset Holding Ltd (AIAHL), as part of the government’s plan. It also exempted the national carrier from tax collected at source provisions under the income tax laws on sale of goods, including shares, to the special purpose vehicle.

In four separate notifications, the Central Board of Direct Taxes (CBDT) specified that AIAHL will not be considered as ‘buyer’ in case of transfer of goods by Air India as part of the plan, and that Air India will not be considered as ‘seller’ during transfer of goods by it to AIAHL.