Query Regarding Capital Gain

I am in CA Inter and started the chapter of Capital Gain.

Conversion of debenture into share is not treated as Capital Gain u/s 47.  Also for debentures and bond the benefit of indexation is not available.

Now, suppose X purchases convertible debentures in Aug 2002 and it get converted into Equity shares in Sept 2012 and then he sells those equity shares in 20-21. So, how we will do indexing? Whether we will take index of 02-03 or 12-13?

Replies (3)
Quick Summary
This discussion clarifies capital gains tax rules for convertible debentures in the UK. It explains that while the conversion itself isn't a capital gain event under Section 47, and indexation benefits aren't typically available for debentures and bonds, the indexation period for shares acquired through conversion starts from the original purchase date of the debentures. This means you'll use the indexation for the year the debentures were bought, not when they were converted into shares.

Indexation for the year 2002-2003 applicable here.

Thank You... I was hoping for the same due to Manjula J Shah case law but situation there was different, so I was a bit confused 😅

Welcome... Confusion is a way to solution(✷‿✷)

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