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Profit on sale of shares

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Querist : Anonymous

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Querist : Anonymous (Querist)
27 September 2011 Mr.X purchased 2700 shares @ 100 each amounts to2,70,000 from an unlisted private company on oct 2009, and the same was allotted in oct 2009. The above shares were sold by him to a listed public company in Dec 2010 at an amount of 14,00,000.This 14,00,000 is invested in shares of another private limited company. Does the profit received on the above sale of 2700 shares taxable? If taxable, under what head of income it is taxable and at what rate?
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CA Siddhartha Bhardwaj

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CA Siddhartha Bhardwaj (Expert)
27 September 2011 Yes this sale of shares is taxable under the head capital gains.

Since the shares have been held for a period of more than 12 months, long term capital gain will arise.

Benefit of indexation will be available.

STT would not have been paid. The gain will be taxed @ 20%.
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