Off Market Deal –
Please analyze the given case and tell me whether there are any adverse ramifications in taxation.
Mr. X is a promoter cum director of ABC Ltd, He sold his house property and has Long term capital Gains of Rs 20Lacs.Now he Transfers Substantial Stake in the company to his wife at substantially Low Price . But this is done off market and no applicability of sec 10(34).Therefore he incurs Huge Long term capital Loss say 12.5 Lacs and wants to Set off LTCL with his Long term capital Gain. Is This Theoretically/practically possible?
Note:The transfer of shares among promoters are not subject to any lock in requirements as per SEBI (investor protection Guidelines).
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