PARTNER
1434 Points
Joined May 2010
Point wise reply
1.what will be the tax liabiluty on my father on gifting to me
No Tax Liability as it is gift from close relative
2.what is the purchase price for me and sale price for my father of the shares
Your purchase price is deemed to be the same as purchase price of your father. No sale price for father as it is a gift
3.now if i sell these gifted shares of my father after 1 year from the date of gift ,what will be the tax liability on me and my father?
Tax liabilty on you will be as follows
If you sell these thru Recog Stock exchange, after paying STT, tax liability is NIL
Else tax liability will be 20% of Capital gain after indexing or 10% of capital gain without indexing which ever is lower. Indexing means adjustng the cost of purchase to the notified indexfor determining present value of historical cost. Eg Rs. 100 purcased in 1990-91 will be recoked as 1120/182 * 100 = 615.38
No tax liability for your father as he s not owner of shares any more.
Please note that you dont have to wait one year before selling these shares as the period of holding of your father will be recokoned for you also
4.does the assesing officer have any right to query on these shares as the amount is substantial?
Query not clear. Better to dislcose the exempt income in your ITR
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