Can long term cap.loss be inflated with cost inflation index

This query is : Open

Jignesh Desai (Querist)
Follow

11 July 2013 An assessee has Long Term Capital Loss of Rs. 6492 on Debt-Oriented Mutual Fund (Long Term Capital Gain on Debt-Oriented Mutual Funds is taxable @ 10 % without Indexation or 20% with Indexation . whichever is better for Assessee) . However , after applying Cost Inflation Index to Purchase Price & then calculating the Long Term Capital Loss , the loss is working out to Rs. 1,15,775 . There is no Taxable Long Term Cap. Gain in same year so this loss needs to be carried forward . Should the Long Term Loss be carried forward as Rs. 6492 or Rs. 1,15,775 ?

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
Follow

24 August 2013 No the long term loss on MF or share shall not be allowed to be carried forwarded as the LTCG is exempted from tax

Jignesh Desai

Jignesh Desai (Querist)
Follow

18 September 2013 Dear Sir , I would beg to differ . In Mutual Funds , there are 2 types - (1) Equity Oriented Funds (Having allocation of more than 65 % in Equity type securities ) where the LTCG is exempt & STCG taxable @ 15% & (2) Debt-Oriented Mutual Funds (Having Allocation of more than 35% in Debt products) - Here the STCG is to be clubbed in the normal income & LTCG is to be taxed at 10% without Indexation or 20% with Indexation whichever is beneficial for assessee . You can check out this information with any Mutual Fund Co.

So , I would like to repeat my Question . Would the Long Term Capital Loss be carried forward as 6492 or 1,15,775 ?

Upgrade to CAclubindia Pro. Subscribe Now!