L t c g and how to invest

This query is : Resolved

Kapil Jain (Querist)
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05 August 2011 Dear Friends

i have share of unlisted company from 2004-05
now i want sell.

How to calculate Tax
how to invest in best way to Save tax.

Am i right
if you indexed the cost tax @ 20
if you do't indexed the cost tax @ 10 %

CA. Anoop Gadia

CA. Anoop Gadia (Expert)
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05 August 2011 yes you right.

it is LTCG which taxable under income tax in Capital Gain head - other than STT paid security gain.

CA Aditya Goel

CA Aditya Goel (Expert)
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06 August 2011 Correct. Its taxable LTCG as shares are of unlisted company and thus not exempt u/s 10.

Kapil Jain

Kapil Jain (Querist)
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06 August 2011 Actually share are not listed.

am i right
for long term,36 months of holding is required
the rule of without indexing and tax rate 10% is not applicable for unlisted company share.

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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07 August 2011 If you are right, when share are not listed then you are wrong in saying that the period required for such shares to be a LT capital asset is 36 months. Only 12 months Holding Period is required for treating the same as LTCA. And here I am absolutely right.
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But it doesn't matter as these are acquired in 2004-05 and by any criteria
these are LTCA.
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And you are absolutely right in asserting that "the rule of without indexing and tax rate 10% is not applicable for unlisted company share." ..
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Now you can exercise the right to indexation of Cost of LTCA and can calculate capital Gains.
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You can rightly get exemption U/s 54F by investing
the sales consideration in Residential House as well as U/s 54EC by investing the capital Gains in Capital Gain Bonds of NHAI etc within the prescribed time limit.