Loss due to non tradeable stocks

You can claim a capital loss when the shares are deemed worthless. Proof of worthlessness is needed. You can report this capital loss i your income tax returns under the head "Capital Gains".

Sir

Thanks.  I checked the ITR 2 but was not able to find a column where this ccan be reported.  And what proof can we show for the worthlessness ?

Though the stock is not tradable the ownership still remanins. If not exited through market need to exit while the company announces buy back and book the loss.Once sold loss can be claimed .

The shares can generally be claimed as a capital loss only when a legally recognised transfer or extinguishment has occurred—not merely because trading is suspended or the company is in liquidation. A liquidator’s appointment or a prolonged trading halt, by itself, may not establish the date or amount of loss. If the shares are ultimately extinguished or cancelled under a liquidation process, the loss may be claimable in that year, subject to the facts and supporting documents.

Check the liquidation order and filings, any final distribution to shareholders, and whether the shares remain listed or held in your demat account. The loss is generally computed against your acquisition cost, reduced by any amount received; treatment as short-term or long-term depends on the applicable holding-period rules. Keep the purchase records, demat statement and liquidation/cancellation evidence. The ₹2 lakh portfolio value is not necessarily the deductible loss: the relevant figure is the tax cost and any recovery.

For distressed-share claims, the key workflow is matching demat records and acquisition cost with the legal event that establishes a disposal or extinguishment. Manual review across old statements and liquidation documents can be difficult; automation reduces repetitive work while professional judgment remains in control. At Jir AI, our 2,000+ AI agents and 650+ integrations streamline GST, ITR, TDS, TCS and other compliance workflows, helping reduce manual workload by up to 70%. For a smoother return-preparation workflow, connect with us on WhatsApp: https://wa.me/message/3HVOZ7HIY4ESC1