08 April 2015
While calculating Capital Gains Of A NRI who sells shares why is Capital Gain (In Foreign Currency) multiplied by buying rate on that date of Transfer and why not the selling rate?
09 April 2015
Dear animish, capital gain computed in accordance with proviso1 of section 48 for nr whixh states capital gain in foreign currency shall be converted into inr at buying rate.
Now you want to know why such methos is prescribed the reason being income tax has to be paid in Indian currency in the Indian currency capital gain so you need to get foreign currency converted in inr from banks and banks will convert the currency at buying rate I.e lower rate that's why the provision is like this.
CAclubindia
