Capital gains holding period Trade dt OR settlement statement?

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while calculating holding period for long term or short term capital gains for shares should one take Trade date as transfer date OR should one take settlement date as transfer date? please can someone give section of IT act or CBDT circular no and date?
Replies (27)
You can consider date as per contract note
Contract note gives both Trade dt and settlement dt! Give relevant sec and IT rules or CBDT circular no.

It will be the date of the actual buy/sell transaction. 

Your gain was realised when the trade occurred, regardless of the settlement date (and regardless of whether or not an eventual settlement was completed).

Gain calculations are based on transaction, not payment. 

Trade date will be considered..

https://www.incometaxindia.gov.in/tutorials/14-%20stcg.pdf
Trade date shall be taken to calculate period of holding
Mostly one or two days gap will be there between trade date and settlement..

Unless the trade date happen at the end FY and Settlement happens in the next financial year , there's no much issue from this ..
In order to educate every CA member herein I now give the income tax department circular no
704, dated 28-4-1995.It is this circular which is relevant for determining the holding period and answers my question.Dear members please learn to be legally factual when you answer questions herein.
The text is given below:
22. Instructions regarding determination of the ‘date of transfer’ and holding period for purposes of capital gains qua transactions in securities

1. Under the provisions of clause (42A) of section 2 of the Income-tax Act, 1961, the shares held in a company or any other security listed in a recognised stock exchange in India or units of the Unit Trust of India or units of a mutual fund specified under section 10(23D) shall be regarded as short-term capital assets if they are held by an assessee for not more than 12 months immediately preceding the date of its transfer. Clarifications have been sought as to which date should be regarded as the date of transfer and also about the date from which the holding period of the securities should be reckoned. Clarifications have also been sought as to how the holding periods will be computed for the purposes of capital gains when the securities, purchased in several lots at different points of time and which are taken delivery of in one lot, are subsequently sold in parts and no correlation of the dates of purchase and sale is available.

2. When the securities are transacted through stock exchanges, it is the established procedure that the brokers first enter into contracts for purchase/sale of securities and thereafter, follow it up with delivery of shares, accompanied by transfer deeds duly signed by the registered holders. The seller is entitled to receive the consideration agreed to as on the date of contract. The Board are of the opinion that it is the date of broker’s note that should be treated as the date of transfer in cases of sale transactions of securities provided such transactions are fol­lowed up by delivery of shares and also the transfer deeds. Similarly, in respect of the purchasers of the securities, the holding period shall be reckoned from the date of the broker’s note for purchase on behalf of the investors. In case the transactions take place directly between the parties and not through stock exchanges the date of contract of sale as declared by the parties shall be treated as the date of transfer provided it is followed up by actual delivery of shares and the transfer deeds.

3. As regards the second issue, where securities are acquired in several lots at different points of time, the First-in-first-out (FIFO) method shall be adopted to reckon the period of the hold­ing of the security, in cases where the dates of purchase and sale could not be correlated through specific numbers of the scrips. In other words, the assets acquired last will be taken to be remaining with the assessee while assets acquired first will be treated as sold. Indexation, wherever applicable, for long-term assets will be regulated on the basis of the holding period determined in this manner.

Circular: No. 704, dated 28-4-1995.

Then what was the point in asking the question in the first place?

It is a way of alerting all dear CA members to give legal back up section or rules or circular when any question is raised herein.We should inculcate legally sound ways of answering herein.This will elevate the quality of the answers posted.!
Reports for tax purposes can be generated through brokers app or website..So this question doesn't araise in practy
The broker report has a disclaimer that the contents have to be verified by the BO .At times the reports are in variance and one has to calculate oneself the capital gains and then this vital circular comes into play!
Stop "chalta hai" attitude.
Eat Sambhar in moderation so that you don't raise such questions.Please develop good habits!
Yeah.You are right , one can go through detailed calculation for cross verification only.. If number of transactions are huge then practically it's impossible to look at each and every scriptt..

It's just like Audit , verify cire areas and remaining based on sampling..

Do you verify each and every transaction in Audit ?

Even income tax accepts the brokers report..

There are Auditors for analysing those reports
Prepare excel sheet for capital gains at beginning of FY . Enter transaction details as soon as they occur!Be accurate and avoid uncalled for notices!
Your approach is very much correct..But practically it doesn't work..

Few people maintain accurately if trading is the only source


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