Capital gain

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

13 May 2012 In case of gift from previous owner which year indexation shall be taken as the base year, the year in which previous owner purchased the assest or the year in which the assessee received the assest as a gift?

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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14 May 2012 Law says index for the year in which the assessee received the asset should be taken. However, there are ITAT decisions to the contrary. Please refer the case of Ms. Pushpa Sofat Vs. ITO 81 ITD 1 , among others.

Mihir Doshi

Mihir Doshi (Expert)
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14 May 2012 Dear Expert,

You are right but as per Singhania Income tax Book, Year of indexation will be the year when the person start possessing the flat. In this case, Year of possession by second owner will be taken into account.

Correct if i am wrong

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Querist : Anonymous

Querist : Anonymous (Querist)

14 May 2012 If the assest was purchased by previous owner before 1980, and assessee sold the assest on the same FY in which it was received as a gift from previous owner. So, if we apply indexation of the year in which it was transfer to assessee n not of the year acquire by previous owner thn assessee shall enjoy 54F exemption? or as indexation is of short term period so he shall not get benefit of 54F?

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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14 May 2012 For the purpose of calculating holding period (for determining LTCG or STCG) of an asset, previous owner's holding period also can be counted. Apply this law in your case and see whether it is LTCG and if it is LTCG then 54F can be availed ,subject to the satisfactions of the other conditions mentioned in that section.

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