Tax on sale of business car

NO,

becouse, u/s-2(14)"capital asset" means property of any kind held by an assessee, whether or not connected with his business or profession, but does not include—

personal effect, that is to say, movable property (including wearing apparel and furniture) held for personal us by the assessee or any member of his family dependent on him, but excludes—

(a)jewellery;

(b) archaeological collections;

(c) drawings;

(d) paintings;

(e) sculptures; or

(f) any work of art.

It will be short term capital gain because according to section 50 if assessee has sold capital asset(building,machiner)  on which depreciation has been allowed,income arising from such assets is treated as short term capital gain regardless of the period of holding.

STCG =2000000-1817810

somebody please confrm this

In my view Rs 265000/- will not be deducted from Rs 2000000/- even if it is be paid by the purchaser directly to the finance company. The reason is that the loan amount is already included in the cost of the asset and it is not an expenditure incurred in relation to the transfer.

CIT v. Attili N. Rao — 252 ITR 880 (SC).

If the block ceases to exist after the sale Rs 2000000-1817810=182190 will be taxed as STCG.