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Loss in ltcg of equity to offset on ltcg on property

Pradeep Kumar (director) (65 Points)

03 August 2019

Hello, I have a question on offsetting LTCG.

Can the previously carried forwarded Loss on Long Term Capital Gain on Equity be offset for the current Long Term Capital Gain on Property?

Likewise, please answer the same scenario for Short Term Capital Gain.

Please help me with this, appreciate it.

Thank you. Pradeep

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6 Replies

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (180927 Points)
Replied 03 August 2019

Can the previously carried forwarded Loss on Long Term Capital Gain on Equity be offset for the current Long Term Capital Gain on Property?

NO ....If the loss/gain over equity was exempt u/s. 10(38). Otherwise YES.

Likewise, please answer the same scenario for Short Term Capital Gain.

No. As LTCL can be set off against LTCG only.

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Pradeep Kumar (director) (65 Points)
Replied 03 August 2019

I am reading the following.

Any LTCL incurred by you upon the sale of such a capital asset can be utilised to set off against LTCG arising from any asset in the current financial year.

The above statement seems to be in contradiction to what you said. How do you infer this? Let me clarify my question more clearly.

Can the loss on long term capital due to equity which was carried forwarded, be offset against the long term capital gain in the property of the current year?

I would like to believe that property and equity are 2 different assets and there is provision to set off the previous loss with current gain irrespective of the asset classes as long as both are under long term capital (gain and loss).

Would appreciate your response again.

aayush chaudhry (15 Points)
Replied 03 August 2019

The long term capital loss incurred on transfer of any capital asset in any previous year can be carry forward upto 8 years and can be set off against income under the same head. The act provides the definition of a capital asset.
Therefore, in your case, the loss which you have brought forward from the last 8 years can be set off against capital gain arising out of transfer of a long term capital asset.
For your kind information, the act distinguishes the long term capital gain and short term capital gain, but there exists no differences among long term capital assets for set off of losses.

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Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (180927 Points)
Replied 03 August 2019

I am reading the following.

Any LTCL incurred by you upon the sale of such a capital asset can be utilised to set off against LTCG arising from any asset in the current financial year.

The above statement seems to be in contradiction to what you said. How do you infer this? Let me clarify my question more clearly.

Its not been contradicted. I confer with the statement. But it is for current year loss adjustment with CY gain.

Can the loss on long term capital due to equity which was carried forwarded, be offset against the long term capital gain in the property of the current year?

I would like to believe that property and equity are 2 different assets and there is provision to set off the previous loss with current gain irrespective of the asset classes as long as both are under long term capital (gain and loss).

To this query, I have answered it in two parts...

A. NO ....If the loss/gain over equity was exempt u/s. 10(38).

B. Otherwise YES.

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