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CS Professional · Advanced Direct Tax Laws and Practice · Transfer Pricing and General Anti Avoidance Rules (GAAR)

Which of the following is expressly listed in section 163(1)(c) of the Income-tax Act, 2025 as a form of capital financing?

Purchase or sale of marketable securities is listed under capital financing in section 163(1)(c), along with borrowing, lending, guarantees and business advances or receivables. Legal services, copyrights and machinery leases fall under other clauses of the definition.

  1. AProvision of legal or accounting service
  2. BPurchase or sale of marketable securitiesCorrect
  3. CTransfer of copyrights
  4. DLease of machinery

Explanation

Section 163(1)(c) covers long-term or short-term borrowing, lending or guarantee, purchase or sale of marketable securities, and advances, deferred payments or receivables arising in business. Legal service is under clause (d), copyrights under (b), and machinery lease under (a).

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