Sunny (CA Business) (401 Points)
26 July 2010If I purchase 100 shares at Rs. 100 per share on 01st July, 2010 from listed stock exchange.
However on 03rd July, 2010 I came to know that my shares cannot be delivered to me as the person who was selling was unable to deliver. So I get 100 shares back at Rs. 105/share.
In this Scenario, does Capital Gain arise?
If yes, how?
Thanks
Sunny
Pankaj
(Student)
(60 Points)
Replied 26 July 2010
Ya for capital gain transfer is must ........ but as no transfer takes place it will not be treated as capital gain.................... but it may be treated as speculation gain as no delivery has taken place or else can be taken as business gain...........
DT Fundas - Tarun rustagi
( Author)
(1150 Points)
Replied 26 July 2010
dear sunny
there is no transfer of anything between u and the dealer.definately it will not attracts any capital gain but the above case is covered under the defination of speculation business.so it is a business income and u are liable to pay tax on that income.
G!rdhar! Jang!d
(Tax Consultants )
(680 Points)
Replied 26 July 2010
thr is no trnsfr so no qust. arise of capital gain
Manoj BG
(Tax Professional and in Service)
(1795 Points)
Replied 27 July 2010
NO CAPITAL GAIN AND HENCE NO CGT
Sunny
(CA Business)
(401 Points)
Replied 27 July 2010
Thanks All.
How can it be considered as speculation gain because the other party failed to deliver but I had ordered genuine purchase.
DT Fundas - Tarun rustagi
( Author)
(1150 Points)
Replied 27 July 2010
dear sunny
speculation transaction is arises when there is no transfer between the parties and they book a profit without transfer.though there is genuine purchase but it is difficult to conveyance ao in regard to this.
CAclubindia
