Trust case

Save Share

This query is : Resolved

Shankar (Querist)

08 August 2026 Trust registered u/s 12A sold Equity mutual fund for Rs.10 lakhs on 25.03.2026 which was purchased on 12.1.2022 out of corpus fund for Rs6,00,000.
On 25.03.2026 Trust purchased another Mutual fund for Rs.10,00,000 ( means net consideration on sale of mutual fund was reinvested )
ITR 7 It was entered as followes:
Schedule AI – Sl. No. 8
Income other than Donation referred in Sec. 10, 11 & 12
Net consideration on transfer of Capital asset 10,00,000
Schedule A – Sl. No. 11
A. Expenditure of the trust/institution:
- Cost of new asset [to claim Exemption u/s 11(1A)] 10,00,000

My question is, is it needs to be entered in Capital gain Schedule also ? if entered in capital gain schedule it is showing as taxable income but in fact it is not taxable as it is reinvested in another capital asset please answer

Aashok Kumar Sharma

Aashok Kumar Sharma

(Expert)

08 August 2026 You must enter the transaction in the Capital Gains schedule to correctly report the asset transfer and compute the gain. Although it initially appears taxable there, the tax liability is nullified because claiming the reinvestment as an application of income under Section 11(1A) in Schedule AI/A offsets the gain entirely.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now