Long Term Capital Gain

Analysis of amendment in Section 10(38) by Finance Act, 2017 & Notification No. 43/2017

Income Tax - Finance Act, 2017 amended section 10(38) of the Income-tax Act, 1961 (the Act) stating that long term capital gains from transfer of listed equity shares acquired on or after 01 October, 2004, would be exempt from tax under section 10(38) of the Act only if the Securities transaction Tax (STT) was paid at the time of acquisition of such s...

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Sec 10(38), CBDT provides host of exemptions

Income Tax - This article summarises the amendment brought in Section 10(38) of the Income Tax Act, 1961, the exemptions provided under the section through notification issued by the central government and discusses few situations where exemption may not be available. ...

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BCAS Suggestions on Draft Notification on Taxation of shares

Income Tax - The draft of the notification to be issued under third proviso to section 10(38) is, in principle, a step in the right direction. We would like to suggest a few changes to the same in order to bring greater clarity and prevent unnecessary and unintended harassment to genuine investors....

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Draft notification on Exemption on LTCG – A strike or spare?

Income Tax - The memorandum to Finance Bill, 2017, explained that the exemption on long-term capital gains tax, provided in section 10(38) of ITA was misutilised to declare unaccounted income . CBDT has issued a draft notification on 3 April , 2017 and provided that the amendment would not apply to any transactions except mentioned in the Notification...

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Draft rules on Sec 10(38) exemption carve-outs by CBDT

Income Tax - Overall, the amendment in form of proviso to S. 10(38) is an anti-abuse measure, and a step forward to the Government’s agenda of cracking unaccounted money. Equally important is the Government’s commitment to notify genuine transactions that remain outside the fold of this amendment....

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Draft notification to stop misuse of long term capital gain exemption

Income Tax - In order to curb the practice of declaring unaccounted income as exempt long term capital gain by entering into sham transactions, the Finance Act, 2017 amended the provisions of section 10 (38) of the Act to provide that exemption under this section for income arising on transfer of equity share acquired or on after 1st day of October, 2...

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Misuse of Long Term Capital gain tax exemption for money laundering

Income Tax - Investments are made in the secondary share markets with a view to capturing gains. In this market, out of nearly 8,000 listed companies, several scrips are not traded regularly. With the collusion of promoters, some brokers arrange for price(s) with purchase of such scrips at nominal costs, and sales at exorbitant prices, with a view t...

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DTC: Jewellery, works of art, property to qualify as long-term investments even if held for a year

Income Tax - The Supreme Court will hear on September 10 the impleadment petition filed by the Forex Derivatives Consumers Forum along with the Special Leave Petition filed by Fixed Income Money Market and Derivatives Association of India (FIMMDA). Forex Derivatives Consumers Forum is a registered association of exporters from across the country, a ma...

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Existing taxation provision of Long term capital gains may continue in DTC

Income Tax - The government is likely to maintain the distinction between short term and long-term capital gains to encourage long-term savings, as it deliberates the draft direct taxes code. The finance minister said in his Budget speech that the new direct taxes law could be rolled out from April 1, 2011. The government is veering around to the view...

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Bonus stripping under the Income tax lens

Income Tax - After taxing investors for dividend stripping, the Income Tax (I-T) Department is gearing up to tax bonus stripping. Official sources say scrutiny of returns filed by companies, brokers and individuals active in the stock markets and in possession of shares revealed wide use of this mechanism to evade tax....

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Section 54/ 54F: no requirement of investment in new residential house in India prior to 01/04/2015

Income Tax Officer Vs Mr. Nishant Lalit Jadhav (ITAT Mumbai) - Undoubtedly, prior to the amendment made by Finance (Nos.2) Act, 2014 w.e.f. 01/04/2015, the language of section 54 of the Act required the assessee to invest the capital gain in a residential property....

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Gain on sale of Shares held for 16 years as investment cannot be treated as business income

The Commissioner Of Income Tax Vs M/S Jindal Poly Films Ltd. (Allahabad High Court) - The Government of India Ministry of Finance Department of Revenue vide Circular No. 6 of 2016 of the Central Board of Direct Taxes 29th February, 2016 referring to the earlier circular No. 4 of 2009 dated 15th June, 2007 has laid down that in order to reduce litigation, the sale of listed shares wou...

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Exemption U/s. 54 cannot be denied for investment in joint name

Shri Jitendra V Faria Vs. ITO (ITAT Mumbai) - Assessee was entitled to full exemption u/s. 54 when full amount was invested by assessee even though property was purchased in joint names of assessee and his brother....

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Income from Share Trading in the nature of business cannot be treated as ‘Capital Gain’

Income-Tax Officer Vs Manusi Securities Pvt. Ltd. (ITAT Ahemdabad) - Assessee is regularly in the business of purchase-sale of equity shares, share transactions entered during the year were in large number, funds were borrowed for the purpose of trading, no separate account has been maintained for the investment portfolio and all the transactions of purchase sale rai...

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No capital gain tax on amount received from WOS for transfer of shares of WOS to a group of shareholders

CIT vs. Annamalaiar Mills (Supreme Court of India) - It is not in dispute that M/s Annamalaiar Textiles (P) Ltd. did not pay any amount to the shareholders who ultimately got the shares transferred in their names. The respondent was holding 100 per cent shares of M/s Annamalaiar Textiles (P) Ltd., before it was transferred to Group B. No payment was m...

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CBDT notifies Cost Inflation indexes with Base Year as 2001-02

Notification No. 44/2017-Income Tax - (05/06/2017) - CBDT has vice Notification No. 44/2017 notified Cost Inflation indexes with Base Year as 2001-02 for the Financial Year 2001-02 to 2017-18 and same are applicable from Financial Year 2017-18....

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CBDT notifies Cost Inflation Index for Financial Year 2015-16

Notification No. 60/2015 - Income Tax - (24/07/2015) - Notification No. 60/2015 - Income Tax S.O. (E) – In exercise of the powers conferred by clause(v) of the Explanation to section 48 of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby makes the following further amendments in the notification of the Government of India in the...

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No capital Gain on Rollover/Extension of Fixed Maturity Plans (FMPs) in same scheme

Circular No. 6/2015-Income Tax - (09/04/2015) - CIRCULAR NO. 6/2015, Dated: April 9, 2015 no capital gains will arise at the time of exercise of the option in the case of Fixed Maturity Plans (FMPs) by the investor to continue in the same scheme. The capital gains will, however, arise at the time of redemption of the units or opting of the scheme...

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Recent Posts in "Long Term Capital Gain"

Analysis of amendment in Section 10(38) by Finance Act, 2017 & Notification No. 43/2017

NA

Finance Act, 2017 amended section 10(38) of the Income-tax Act, 1961 (the Act) stating that long term capital gains from transfer of listed equity shares acquired on or after 01 October, 2004, would be exempt from tax under section 10(38) of the Act only if the Securities transaction Tax (STT) was paid at the time of acquisition of such s...

Read More
Posted Under: Income Tax |

Sec 10(38), CBDT provides host of exemptions

This article summarises the amendment brought in Section 10(38) of the Income Tax Act, 1961, the exemptions provided under the section through notification issued by the central government and discusses few situations where exemption may not be available. ...

Read More
Posted Under: Income Tax | ,

CBDT notifies Cost Inflation indexes with Base Year as 2001-02

Notification No. 44/2017-Income Tax (05/06/2017)

CBDT has vice Notification No. 44/2017 notified Cost Inflation indexes with Base Year as 2001-02 for the Financial Year 2001-02 to 2017-18 and same are applicable from Financial Year 2017-18....

Read More

Section 54/ 54F: no requirement of investment in new residential house in India prior to 01/04/2015

Income Tax Officer Vs Mr. Nishant Lalit Jadhav (ITAT Mumbai)

Undoubtedly, prior to the amendment made by Finance (Nos.2) Act, 2014 w.e.f. 01/04/2015, the language of section 54 of the Act required the assessee to invest the capital gain in a residential property....

Read More

Gain on sale of Shares held for 16 years as investment cannot be treated as business income

The Commissioner Of Income Tax Vs M/S Jindal Poly Films Ltd. (Allahabad High Court)

The Government of India Ministry of Finance Department of Revenue vide Circular No. 6 of 2016 of the Central Board of Direct Taxes 29th February, 2016 referring to the earlier circular No. 4 of 2009 dated 15th June, 2007 has laid down that in order to reduce litigation, the sale of listed shares would be treated as capital gain if they ar...

Read More

Exemption U/s. 54 cannot be denied for investment in joint name

Shri Jitendra V Faria Vs. ITO (ITAT Mumbai)

Assessee was entitled to full exemption u/s. 54 when full amount was invested by assessee even though property was purchased in joint names of assessee and his brother....

Read More

Income from Share Trading in the nature of business cannot be treated as ‘Capital Gain’

Income-Tax Officer Vs Manusi Securities Pvt. Ltd. (ITAT Ahemdabad)

Assessee is regularly in the business of purchase-sale of equity shares, share transactions entered during the year were in large number, funds were borrowed for the purpose of trading, no separate account has been maintained for the investment portfolio and all the transactions of purchase sale raised are only for one scrip namely Suraj ...

Read More

BCAS Suggestions on Draft Notification on Taxation of shares

The draft of the notification to be issued under third proviso to section 10(38) is, in principle, a step in the right direction. We would like to suggest a few changes to the same in order to bring greater clarity and prevent unnecessary and unintended harassment to genuine investors....

Read More
Posted Under: Income Tax |

Draft notification on Exemption on LTCG – A strike or spare?

The memorandum to Finance Bill, 2017, explained that the exemption on long-term capital gains tax, provided in section 10(38) of ITA was misutilised to declare unaccounted income . CBDT has issued a draft notification on 3 April , 2017 and provided that the amendment would not apply to any transactions except mentioned in the Notification...

Read More

No capital gain tax on amount received from WOS for transfer of shares of WOS to a group of shareholders

CIT vs. Annamalaiar Mills (Supreme Court of India)

It is not in dispute that M/s Annamalaiar Textiles (P) Ltd. did not pay any amount to the shareholders who ultimately got the shares transferred in their names. The respondent was holding 100 per cent shares of M/s Annamalaiar Textiles (P) Ltd., before it was transferred to Group B. No payment was made to the shareholders belonging to Gro...

Read More
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