Capital Gain Tax
This query is : Resolved
29 April 2008
My Client got share warrants on 01.01.2007
He converted the warrants into equity shares on 01.07.2007
He later sold the converted shares on 31.03.2008
Query:
1) Whether conversion of share warrants into equity shares is a transfer and attract capital gain tax on the date of conversion?
2) If not, what is the period of holding for equity shares sold on 31.03.2008?
He converted the warrants into equity shares on 01.07.2007
He later sold the converted shares on 31.03.2008
Query:
1) Whether conversion of share warrants into equity shares is a transfer and attract capital gain tax on the date of conversion?
2) If not, what is the period of holding for equity shares sold on 31.03.2008?
29 April 2008
Share warrants are option given by company to purchase share of company at specific rate before specfic period or before specific date for a valuable cosideration so it is not transfer. as holder of share warrants and holder of shares are same person. In other words there is no different identity of transferee & Transferor and this is the exact reason where it is called "convesion" rather than transfer &
it will not attract any capital Gain.
As conversion place on 01-07-2007 & from that specific date only thewarrant holder becomes equity holder with other rights when he sales the shares on 31-03-2008, the holding period is less than year it will attract short Term Capital Gain.
it will not attract any capital Gain.
As conversion place on 01-07-2007 & from that specific date only thewarrant holder becomes equity holder with other rights when he sales the shares on 31-03-2008, the holding period is less than year it will attract short Term Capital Gain.
30 April 2008
Sir,
At the time of allotment of warrants, the company collected ,say, Rs 20/- per warrant and at the date of conversion, the co. issued shares for Rs 200/- thereby collected the balance of Rs 180/-
What is the cost of aquisition of warrants/shares?
At the time of allotment of warrants, the company collected ,say, Rs 20/- per warrant and at the date of conversion, the co. issued shares for Rs 200/- thereby collected the balance of Rs 180/-
What is the cost of aquisition of warrants/shares?
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Accounting treatment of AMC alongwith the purchase of Laptop
- Condonation Request sec 119(2) b -Enhancement Limit of Leave Exemption prior to AY 2023
- Unable to File TDS Q2 Return – New TRACES Portal Error
- Not ordinarily resident having partnership income in India and salary in USA is any form to filed be
- GST Treatment of Purchases with GST Paid where Outward Supplies of Manufactured CattleFeed Exempt
- Taxation of crypto futures in India Fy 2026- 2027
- Transfer of Physical Stock Between Two Proprietorship Concerns
- EPF ECR NEW RULES Sep 17th 2026
- Issuing of delivery challan by seller of goods
- Expert Help Required for TDS Refund 100000 Through TRACES – AY 2022–23
- IMPORT PURCHASE ENTRY PASSED IN BOOKS OF ACCOUNT
- FAST DS 26 Undisclosed Foreign Asset Disclosure Scheme 2026
- Regime change
- Goods sold but invoice not issued
- Tally: Imported bank entries do not show up in manual reconciliation
- Sales of goods of amount Rs97 lakhs to a party
- Confused About My Career After 12th — Cyber Security, AI or Finance? Need Guidance
- FAST-DS 2026 Under Tax Law - No recourse or support for person declaring via this scheme?
- Guidance Needed: Linking Multiple Form 26QB Payments and Responding to ITD Defaulter Notice
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
