Capital gains

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Priti Modi (Querist)
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17 October 2017 A company is engaged in the business of real estate. It had purchased flats in the year 2009. As on 2017, the company wants to convert the flats from stock in trade to investment. My queries relating to the same are:
1. Period of holding for the purpose of ascertaining whether it is long term or short term would be reckoned from 2009 or 2017?
2. What will be the base indexation? Will it be 2009 or 2017?

K Srinivas, CMA CS

K Srinivas, CMA CS (Expert)
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17 October 2017 Firstly, No capital gains arises on conversion of stock in trade to capital asset

K Srinivas, CMA CS

K Srinivas, CMA CS (Expert)
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17 October 2017 1. Period of holding for the purpose of ascertaining whether it is long term or short term would be reckoned from 2009 or 2017?

Period of holding will begin from the date of conversion of stock in trade to capital asset

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K Srinivas, CMA CS

K Srinivas, CMA CS (Expert)
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17 October 2017 2. Indexation need doesnt arise as there is no capital gains liability on conversion

Priti Modi

Priti Modi (Querist)
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18 October 2017 When the property would be finally sold off, then what shall be the base year?

K Srinivas, CMA CS

K Srinivas, CMA CS (Expert)
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19 October 2017 When the property would be finally sold off, then what shall be the base year?
Year on which the stock in trade was converted into Asset will be base year

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