In its Union Budget 2019-20 Proposals, Association of Mutual Funds in India has requested clarity on the capital gains tax treatment for the healthy part of the portfolio of a scheme and the segregated portfolio held by the unitholder. This comes after Securities and Exchange Board of India introduced creation of segregated portfolio, also referred to as side-pocketing, of debt and money market instruments in case of an untoward credit event. By doing so, only the stressed part of the entire portfolio would be isolated and unitholders of the affected scheme would be allotted side-pocket units in the same ratio as in their investment in the parent scheme. The remaining portfolio would be treated healthy and redeemable.