Capital Gains Loss Set Off

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Swapnil Gorde (Querist)
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26 July 2010 I am having loss under LTCG which is carried forward from A.Y. 2002-03. In the current A.Y. can it be set off against STCG.
please advice and also send me relevant case law for the same if any

CA. Pradeep Nayak

CA. Pradeep Nayak (Expert)
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26 July 2010 Long term capital loss cannot be set off against Short term capital gain in any A.Y.

Swapnil Gorde

Swapnil Gorde (Querist)
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26 July 2010 Dear PRadeep,
As per provisions of Carry forward of losses, from A.Y. 2002-03 onwards the provision stands changed. hence this provision being applicable after 2002-2003 i am of the opinion that the losses which pertaining to earlier period which remain, should be allowed to be set off against STCG as well as LTCG.

Aditya Maheshwari

Aditya Maheshwari (Expert)
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26 July 2010 Current provision for taxation should be followed and not erstwhile provisions.

for current year rule is LT against Long term only. Hence set off not possible.

Swapnil Gorde

Swapnil Gorde (Querist)
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26 July 2010 Aditya,
if you read the provision carefully, this provision is applicable for only losses which are carried forward after 2002-03. nothing is mentioned with regard to earlier period losses. so my loss in current year is eligible for set off against current year LTCG as well as STCG.

considering a fundamental rule benefit of doubt must be given to assessee.

Suggest.

in case you have any case law with regards to this kindly let me know for my confirmation.

CA. Pradeep Nayak

CA. Pradeep Nayak (Expert)
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26 July 2010 Loss may be related to A.Y 2002-03. But STCG is related to current year. You cannot apply erstwhile provisions for the current year income.

Swapnil Gorde

Swapnil Gorde (Querist)
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26 July 2010 Where dose it says like that in the act or in notification or case Law. please help? provide me please.

Aditya Maheshwari

Aditya Maheshwari (Expert)
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26 July 2010 The section states itself that substitued by the Finance Act 2002 w. e. f. 1-4-2003.

So w. e. f. 01-4-2003 the new provision should be applied and not the old one.

It states this provision is applicable w. e. f. 01.04.2003 and not applicable to loss incurred after 2003.

Swapnil Gorde

Swapnil Gorde (Querist)
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26 July 2010 Dear Aditya

this provision is not applicable from A.Y. 2003-04. you are correct.
This is provision related to Losses set off.
so if i want to set of loss of period before 2002-03, with income of A.Y.2010-11 how come this provision is restricting me for not doing this.
i am not setting of losses of current year, i am trying to set off income of current year.
so technically there is loop hole in this provision and hence should be allowed.
even returns are also supporting this sort of adjustments.
kindly review again.

Aditya Maheshwari

Aditya Maheshwari (Expert)
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26 July 2010 In the return format also only b/f STCL can be set off against STCG and b/f LTCL with LTCG. See the format.

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