Capital Gain

This query is : Resolved

Deepti Gunwani (Querist)
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17 December 2010 Mr. X and Mr. y are directors in a private limited unlisted company in the ratio 9:1. Now after 16 years they have sold off their all shares to Mr. Z who will arry on the business of company. Would Mr. X and Y be liable to CG tax? if yes, how it will be calculated? What will be the exemptions available to them.
Also, Mr. Y is a salaried employee in another company xyz. What would be his tax implication?

Aditya Maheshwari

Aditya Maheshwari (Expert)
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17 December 2010 Yes Mr. X and Y be liable to CG tax.
Computation would be Sales consideration less indexed cost of acquisition.

Exemption available u/s 54EC & 54F subject to fulfillment of conditions as specified in the section.

Mr. Y's salary income taxable under the head salary.

Deepti Gunwani

Deepti Gunwani (Querist)
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17 December 2010 Dear Sir,

Thanks for your reply.
Further to my query, if the assessee wants to avail the exemption u/s 54F and instead of purchasing a new residential house, he repays his home loan taken 7 years ago. Will the exemption be available to him?
Also, will the indexation benefit be available in computation of LTCG?

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Aditya Maheshwari

Aditya Maheshwari (Expert)
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17 December 2010 no exemption available.

Indexation benefit available.

Deepti Gunwani

Deepti Gunwani (Querist)
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18 December 2010 thank you sir.