Capital Gain

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This query is : Resolved

Deepti Gunwani (Querist)

17 December 2010 Mr. X and Mr. y are directors in a private limited unlisted company in the ratio 9:1. Now after 16 years they have sold off their all shares to Mr. Z who will arry on the business of company. Would Mr. X and Y be liable to CG tax? if yes, how it will be calculated? What will be the exemptions available to them.
Also, Mr. Y is a salaried employee in another company xyz. What would be his tax implication?

Aditya Maheshwari

Aditya Maheshwari (Expert)

17 December 2010 Yes Mr. X and Y be liable to CG tax.
Computation would be Sales consideration less indexed cost of acquisition.

Exemption available u/s 54EC & 54F subject to fulfillment of conditions as specified in the section.

Mr. Y's salary income taxable under the head salary.

Deepti Gunwani

Deepti Gunwani (Querist)

17 December 2010 Dear Sir,

Thanks for your reply.
Further to my query, if the assessee wants to avail the exemption u/s 54F and instead of purchasing a new residential house, he repays his home loan taken 7 years ago. Will the exemption be available to him?
Also, will the indexation benefit be available in computation of LTCG?

Aditya Maheshwari

Aditya Maheshwari (Expert)

17 December 2010 no exemption available.

Indexation benefit available.

Deepti Gunwani

Deepti Gunwani (Querist)

18 December 2010 thank you sir.

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