LTCG on Immovable Property

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An assessee is having Brought Forwarded Capital loss for the A.Y.2025-26 of Rs.270 lakhs. For the A.Y.2025-26, he has a Long term Capital Gain of Rs.120 lakhs without indexation of cost. If cost is indexed, then it's again a Capital Long term loss. However, under the new provisions, only for computing tax on long-term capital Gain indexation is considered. Because of this two issues are coming in current year computation: 1. There's no tax on capital Gain is seen computed, but Brought forward loss is getting reduced by Rs.120 lakhs. 2. Also surcharge is being added to other heads of Income, as if his income is more than 100 lakhs.The law, as drafted, causes reduction of carried-forward losses and surcharge exposure even where no effective taxable LTCG exists.

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Quick Summary
This discussion addresses a complex scenario involving Long Term Capital Gains (LTCG) on immovable property sold after 22nd July 2024. The core issue is that while indexation might negate a taxable gain, the current tax laws appear to reduce brought-forward losses and trigger surcharge exposure. Participants are exploring whether this is a defect in the law and suggesting potential avenues for grievance redressal.

What is the asset sold/transferred? Whether any immovable property?

When was it sold? After 22July, 2024?

It is an Immovable Property sold after 22.07.2024

It is defect in the utility. You should be allowed for indexation, though the loss will not be allowed to be set off with any other LTCG.

File grievance as it is offsetting the bought foeward losses.

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