Ltcg

Ans. to query 1-
Pay tax when stock got converted into capital asset based on Fair market value. it will be taxed as business income.
Also when this capital asset is sold then tax is to be levied based on cost of aquisition as Fair market value which was calculated while paying tax on conversion of stock into capital asset
Ans to Query 2-
There is exception list to section 10(38) in cases where Securities transaction tax is not paid but benefit of section 10(38) can be availed in which gift is covered
I think that exception list is also applicable for this section 112A.