Form explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Form No. 28 is the report an accountant gives on the net worth of an undertaking or division sold as a going concern for a lump sum. The assessee who sells furnishes it, and the accountant certifies that the net worth has been worked out correctly under section 77. This guide goes through the form as printed in the Income-tax Rules, 2026 (G.S.R. 198(E), notified on 20 March 2026), read with the amending notifications issued up to 22 September 2026.
Under rule 54, every assessee who makes a slump sale under section 77(4) must submit a report from an accountant in Form No. 28 before the "specified date referred to in section 63". The form has four rows of particulars, a computation of fair market value and net worth in row 4, and a verification signed by the accountant. Note 5 says the form is filed along with the return of income in accordance with section 263. The rule and the form print no other time limit.
Where the form comes from
Section 77 of the Income-tax Act, 2025 deals with a slump sale. Profit or gain from it is long-term capital gains, unless the undertaking or division was held for thirty-six months or less, in which case it is short-term (sub-section (2)). The "net worth" of the undertaking is deemed to be both the cost of acquisition and the cost of improvement, and the fair market value of the capital assets, calculated in the prescribed manner, is deemed to be the full value of consideration (sub-section (3)). Sub-section (4) then requires every assessee to furnish "in the prescribed form" a report of an accountant before the specified date referred to in section 63. The report must include the computation of net worth and certify that it has been correctly arrived at. Sub-section (5) defines net worth as the aggregate value of total assets, reduced by liabilities as appearing in the books of account, with any revaluation ignored. The detail is in Section 77 of the Income-tax Act, 2025.
Rule 54 supplies the form. It says the accountant is one "as defined in section 515(3)(b)" and that the report goes in Form No. 28 before the specified date referred to in section 63. The rule does not give a calendar date, and neither does this article; the date is fixed by section 63. For the rule itself, see rules 54 and 55 on the slump sale report.
Who furnishes it and who signs
The assessee transferor furnishes Form No. 28. The accountant signs the verification, giving name, designation, membership number, UDIN details if any, name of the proprietorship or firm, and firm registration number. Note 3 says "accountant" has the meaning in section 515(3)(b). Note 6 provides that where there is more than one petitioner, the person authorised to apply signs the form.
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What the form asks, row by row
| Row | What it asks |
|---|---|
| 1 | The transferor: name, address, PAN, nature of business, contact number with country code, email ID |
| 2 | The buyer (transferee): name, address, PAN |
| 3 | The tax year |
| 4A (i) to (iii) | Nature of business, address of business and date of transfer of the undertaking or division |
| 4A (iv) | Fair market value of the capital assets transferred (FMV1) |
| 4A (v) | Fair market value of the consideration received or accruing (FMV2) |
| 4A (vi) | Fair market value of the capital assets: the higher of (iv)(f) or (v)(e) |
| 4A (vii) | Net worth of the undertaking or division |
| 4A (viii) | Upload of the Profit and Loss account and Balance sheet of the relevant tax year |
| 4B | Repeat, if required (for a further undertaking or division) |
FMV1: the capital assets transferred
Row 4A(iv) builds FMV1 from five parts. Part (a) takes the book value of all assets other than jewellery, artistic work, shares, securities and immovable property as they appear in the books, then deducts any income-tax paid (reduced by any refund claimed) and any amount shown as an asset that does not represent the value of an asset, such as unamortised deferred expenditure. Part (b) is the price jewellery and artistic work would fetch in the open market on the basis of a valuation report from a registered valuer. Part (c) is the fair market value of shares and securities determined in the manner provided in rule 57. Part (d) is the stamp duty value of immovable property. Part (e) is the book value of liabilities, from which paid-up equity capital, dividends set apart but not declared, reserves and surplus (even if negative, other than those set apart for depreciation), the excess provision for taxation, provisions for other than ascertained liabilities and contingent liabilities are deducted, as listed in items (II) to (VII). The form closes with FMV1 = (a)(IV) + (b) + (c) + (d) - (e)(VIII).
FMV2: the consideration
Row 4A(v) takes the monetary consideration received or accruing, plus the fair market value of non-monetary consideration represented by property referred to in rule 57 (serial numbers 1 to 5 of its Table), plus the open-market price, on a registered valuer's report, of other non-monetary consideration that is not immovable property, plus the stamp duty value where the non-monetary consideration is immovable property. FMV2 is the sum of these. Row (vi) then takes the higher of FMV1 and FMV2.
Net worth
Row 4A(vii) works out net worth in three steps. For depreciable assets, it takes the written down value of the assets of the undertaking or division determined in accordance with section 41(1)(c). For other assets, it takes the book value. The two are added to give the aggregate value of total assets, and the value of liabilities relatable to the undertaking, as appearing in the books, is deducted to give the net worth. Note 4 says that any change in the value of assets on account of revaluation is to be ignored while indicating amounts in the asset rows.
The verification
The accountant states that the accounts and records of the assessee for the tax year have been examined; that the information and explanations needed to ascertain and compute net worth were obtained, as far as the signatory knows and believes; and that the net worth given in row 4 has been computed correctly in accordance with section 77. The words "I/We" and "my/our" are to be struck out as applicable.
Notes that govern the form
- Note 1: names to be given in full, without abbreviation; for an individual, first, middle and last name.
- Note 2: an address must contain country or region, flat or door or building, road or street or block or sector, PIN or ZIP code, post office, area or locality, district and state.
- Note 5: the form is filed along with the return of income in accordance with section 263.
- Note 7: amounts are filled in rupees unless otherwise provided.
- Note 8: some of the information in the form is to be pre-filled to the extent possible.
A worked illustration
Suppose Meridian Foods Private Limited sells its packaging division to Orchid Containers LLP for a lump sum. The accountant starts from the division's books: assets other than jewellery, shares, securities and immovable property go into row (iv)(a), the jewellery and the plot of land each go to their own rows, and liabilities go into row (iv)(e) with the listed deductions. For net worth, the written down value of the depreciable assets and the book value of the other assets are added and the division's liabilities are deducted. Because the division is sold as a whole, the lump sum is not split item by item; row 4A(v) takes the whole monetary consideration. The accountant compares FMV1 with FMV2, enters the higher in row (vi), and certifies the net worth. The report goes in before the specified date referred to in section 63, together with the return as Note 5 says.
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Key takeaways
- Form No. 28 is the accountant's report required by section 77(4) for every slump sale.
- Rule 54 requires it before the specified date referred to in section 63; Note 5 says it is filed with the return under section 263.
- Row 4 builds FMV1 (assets less liabilities), FMV2 (consideration), the higher of the two, and the net worth of the undertaking.
- Revaluation of assets is ignored in the net worth computation.
- The accountant certifies the net worth under section 77, and the form must be repeated for each undertaking or division, if required.
Read next
- Rules 54 and 55 on the slump sale report
- Section 77: capital gains on slump sale
- Form No. 32: audit report for deductions under sections 46 and 138 to 144
- Form Nos. 34 and 35: reports for additional employee cost and offshore banking or IFSC unit deductions
Disclaimer: Based on the Income-tax Rules, 2026 (G.S.R. 198(E), notified on 20 March 2026), read with the amending notifications issued up to 22 September 2026, as consulted on 4 October 2026. It explains the words of the forms and rules only; later notifications, the forms and utilities on the e-filing portal, circulars and the way the tax authorities apply these provisions should be checked. This article is general information, not legal advice; check the official text before acting.