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query in cap gain

KIRTI (ca-final) (130 Points)

05 October 2009

hello everyone?

please reply me if u r 100% sure that

WHETHER NON-RESIDENTS ARE ALSO GIVEN INDEXATION BENEFITS WHILE COMPUTING LONG TERM GAIN FO THEM IF ANY?

thanks in advance

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3 Replies

Max Payne (employed) (2574 Points)
Replied 05 October 2009

Yes the NRs can also claim indexation benefits available to residents, except in the case where the shares in Indian Companies are acquired in foriegn currency. For this, you can see the second proviso to section 48 which says that the words "indexed cost of acquisition" shall be replace by the words "cost of acquisition" in the case of securities referred to in section 115AC(1).

For other LTC assets, NRs can also claim indexation benefits.

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Juzer Sadikot (CA - innovative solutions for Imports and Exports) (1309 Points)
Replied 05 October 2009

Dear Kirti,

It depends on type of Assets and whether you are opting for benifit of special rate under chapter XII-A.

If you are claiming benefit of applicable section under chapter XII or first proviso to section 48, nothing contained in second proviso to section 48 (i.e. Indexation Benefits) shall apply while computing Capital Gain Tax.

Also, Bonds and Debenture are not having indexation benefits irrespective of residential status.

Also, you need to make sure the nature of Capital Asset whether Short Term or Long Term, there are some issue involved in this too.

Thanks and Regards