"There is a strong demand from investors to defer GAAR. We are trying to address their concerns," said a finance ministry official, who did not wish to be identified.
The official denied the introduction of any grandfathering provisions under GAAR, but did not rule out the possibility of deferment.
The government will also specify a threshold in GAAR to determine the tax amount above which the rule could be invoked.
The ministry is planning a high threshold so that small investors, salaried taxpayers and individuals are exempted. The threshold may be around Rs 10-15 crore (Rs 100-150 million), lower than industry expectations.
If GAAR is implemented from April 2013, it will give time to both the investors and the tax authorities to adjust to the system.
The recommendations on the implementation date will be made by a panel framing the rules headed by the Director General of International Taxation.
The final call will be taken by Finance Minister Pranab Mukherjee and stated in his reply to the Finance Bill, expected to be taken up in the Lok Sabha on May 7.
GAAR is a part of the Direct Taxes Code expected to come from 2013-14.
However, GAAR was proposed in the Budget for 2012-13 itself. If deferred, it will coincide with the expected time frame for the DTC's introduction.
Though the government had clarified that GAAR provisions would apply from April 2012, investors feared capital gains to them on investments made last year could come under the rule.
GAAR is not expected to come into force with retrospective effect unlike amendments to the Income Tax Act.
Investors apprehended GAAR applying to shares purchased before April 1, 2012
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