Capital Gain

This query is : Resolved

Guest

Guest (Querist)

25 April 2010 Mr X purchased jellewery in 1/4/2000 for rs 300000 and converted it into stock on 1/4/2002. FMV was rs 610000 as on 1/4/2002.Further Mr X sold stock for rs 1020000 on 1/4/2009.What is Tax Impact.
Further if mr X gifted his jewellery on 1/4/2009 to his NRI Daughter then what will be the tax impact in hands of Mr X and Nri Daughter?

CA. Deepak Narula

CA. Deepak Narula (Expert)
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25 April 2010 the capital gain will be short term of rs. 610000-300000=310000 and PGBP income will be rs. 1020000-610000=410000. both the incomes would be taxable in the year of sale i.e. 2009-10.

if jewelery is gifted to daughter after conversion into stock in trade it will simply be treated as drawings from my point of view.
in the hands of daughter, the period of holding and actual cost to his father will be considered her period of holding and actual cost.

Guest

Guest (Querist)

26 April 2010 Thank you CA Deepak K Narula Sir. I'm Grateful for your reply.