Long term capital loss
This query is : Resolved
Guest
Guest
(Querist)
11 August 2010
WHETHER LONG TERM CAPITAL LOSS OF SHARES CAN BE SET OFF AGAINST THE LONG TERM CAPITAL GAIN ON SALE OF BUILDING ARISING IN THE SAME YEAR AS PER SECTION 74 (1) (b) OF THE INCOME TAX ACT, 1961?
11 August 2010
Any capital gains arising on sale of shares on which STT is paid is exempt u/s 10(38). Loss arising from such transactions cannot be carried forward or set off against other taxable transactions which are not exempt. Hence, set off is not possible.
If the share sale transaction is not done through stock exchange & no STT is paid, such gains can be used for set off against other Long term capital loss such as one arising on sale of building.
If the share sale transaction is not done through stock exchange & no STT is paid, such gains can be used for set off against other Long term capital loss such as one arising on sale of building.
Guest
Guest
(Querist)
20 August 2010
thanks for ur reply...
But still it is subject to discussion that whether the same is fall under section 74 (1) (b) of the Income Tax Act?
But still it is subject to discussion that whether the same is fall under section 74 (1) (b) of the Income Tax Act?
20 August 2010
Loss must not be from exempt source of income - The provisions of sections 70 and 71 relating to set off of loss from one head against income from another head contemplate loss from a source the income from which is liable to tax. If income from a source is altogether exempt from tax, loss from that source cannot be set off against income from a different source or income under a different head - CIT v. S.S. Thiagarajan [1981] 129 ITR 115 (Mad.).
20 August 2010
Since sale of share held for more than one year sold on exchange is exempt loss cannot be used for set off of profit.
Guest
Guest
(Querist)
21 August 2010
thanks Aditya...
21 August 2010
U can also thank by using the thank user icon.
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