Mr.X purchased 2700 shares @ Rs. 100 each amounts to Rs. 2,70,000 from an unlisted private company on oct 2009, and the same was allotted in oct 2009. The above shares were sold by him to a listed public company in Dec 2010 at an amount of Rs.14,00,000.This Rs. 14,00,000 is invested in shares of another private limited company. Does the profit received on the above sale of 2700 shares taxable? If taxable, under what head of income it is taxable and at what rate?
8 Replies
CA RICHA BADALIA
(CA,CS)
(1682 Points)
Replied 27 September 2011
Profit is chargeable to tax under capital gain and tax rate applicable is 20%
CA PRAVEEN SINGH
(MANAGER ACCOUNTS)
(2277 Points)
Replied 27 September 2011
YES MY FRIEND IT IS A TEXABLE PROFIT....
IT WILL BE A CAPITAL GAIN....& LONG TERM...BECAUSE HOLDING PERIOD IS MORE THAN ONE YEAR...
SO THAT,LONG TERM CAPITAL GAIN...
TAX RATE IS...20%....
RIGHT RICHA......
Kalyan Babu Muvva
(M.COM,CA FINAL )
(63 Points)
Replied 28 September 2011
Ofcourse they are chargeble under(Short Term)Capital Gains @ Direct Slab Rate of 20% of such profit.
Kalyan Babu Muvva
(M.COM,CA FINAL )
(63 Points)
Replied 28 September 2011
Oh sorry richa you are correct ...why because those shares were held by him for the period more then 12 Months so they will chrgeble under Long Term Capital Gains.
TRILOCHAN
(SENIOR ACCOUNTANT)
(698 Points)
Replied 28 September 2011
LTCG and tax rate 20% applicable
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