Tax on Listed NCDs

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rajat (Querist)
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21 January 2011 Sir i have got 10 listed Ncds each of Rs1000 during ipo allotment for 11% cummulative scheme on sep/2009 but after 5 months I have purchased 10 more same ncds on bse exchange at price of Rs. 1045 .

My question is what is the tax treatement on the above ncd.

thanks

B. Gopalkrishna Baliga

B. Gopalkrishna Baliga (Expert)
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21 January 2011 when you sell the ncds, it will be considered as capital gains and will be taxed accordingly. if you sell it within 1 year it will be short term capital gains and will be taxed at the prescribed rates and if you sell it after 1 year it will be considered as long term capital gains and thus will be exempted since these are listed securities.