capital gain on bonus share

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UMA SHANKER SHARDA (Querist)
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06 January 2011 Dear all,

I m having 100 shares in a pvt ltd co. owned from 2003-04 allotted me @ 10/- per share and in the current fin year, the co allotted me 200 bonus shares. book value before issue of bonus share was Rs.50 and after bonus is 16.67. I want to sell all share @ 16.67 per share. what will be my position u/s 56(2)(vii) and capital gain for original allotment and bonus share.
Your urgent reply shall highly be apprecated.
Thanks in advance

Aditya Maheshwari

Aditya Maheshwari (Expert)
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06 January 2011 56(2) applies to buyer and not seller and if sold at book value as certified by CA or a merchant banker then 56(2) has no application.

Old shares will be LTCG taxable @ 20% after indexation benefit & new shares would be STCG taxable at slab rates.