ESOPs Holding period to be from date of grant not from date of vesting

Shri. N. R. Ravikrishnan Vs ACIT (ITAT Bangalore)

HOLDING PERIOD TO BE CALCULATED FROM THE DATE OF GRANT IN CASE OF TRANSFER OF UNEXERCISED STOCK OPTION.

FACTS –

Assessee’s return was selected for scrutiny, wherein, AO treated LTCG arising on transfer of ESOP option amounting to INR 20,41,672 as STCG and consequently AO disallowed deduction u/s 54EC.

Total 6000 ESOP was transferred to Infosys out of which 3750 options were long term and 2250 options were short term. Out of the disputed 3750 options, 1250 options were granted on 28.02.2003 and 2500 options were granted on 02.02.2004 and these 3750 options were transferred on 07.03.2007.

Please become a Premium member. If you are already a Premium member, login here to access the full content.