Capital Gain

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Chirag B Shah (Querist)
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19 March 2008 In Asst Yr 04-05 i have long Term Capital Gain in Equity Shares after applying 10% without indexation and Long Term Capital Loss in Equity shares at 20% after applying indexation, Now Can L.T.C.L derived after applying indexation can be set-off against the L.T.C.G of without indexation or not - Please quote any case law if any. However in Set-off & Carry Forward Loss no where it is mentioned that L.T.C.L with indexation cannot be set-off against L.T.C.G arrived before indexation. so please reply on the basis of section and not on logic

kartik_somu

kartik_somu (Expert)
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19 March 2008 There is no specific mention in the Act that LTCG arising after indexation can be set off only against LTCG arising in a similar manner.

I am of the opinion that it can be set off.

R.V.RAO

R.V.RAO (Expert)
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19 March 2008 FOR ANY PARTICULAR ASST. YEAR, YOU HAVE AN OPTION TO ARRIVE AT CAPITAL GAINS WITH OR WITHOUT INDEXATION .
SO WHEN YOU HAVE CHOSEN A PARTICULAR OPTION OF WITH/ WITHOUT INDEXATION , HOW CAN IT BE POSSIBLE TO SET OFF THESE TWO OPTIONS ONE AGAINST THE OTHER?
THERE IS ACCORDING TO ME NO SUCH PROVISO.
CONSIDER FOR EXAMPLE AN EMPLOYEE IS GIVEN AN OPTION TO CHOOSE BETWEEN HRA AND COMPANY ACCOMMODATION.
HE CALCULATES THE LEAST TAXABLE OPTION AND CHOOSES THAT OPTION.
BUT HE CANNOT SET OFF THE TAX UNDER ONE OPTION AGAINST TAX UNDER THE OTHER OPTION.HE CAN ONLY CHOOSE THE BEST OPTION AND THAT IS ALL.
R.V.RAO

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CA. GOPAL SONIKA

CA. GOPAL SONIKA (Expert)
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20 March 2008 As the act is silent about the nature of transaction under the head Long Term Capital Gain for set-off, the above transaction can be set-off.