Taxability on sale of Long Term Debentures??

it's not exempted...fully taxable

dear friend

LTCG is exempt U/s 10(38) of the Income tax act 1961 subject to the following condition

1. The capital assets must be equity shares or units of equity oriented mutual fund

2. transfer of said capital assets must be charged to STT

Hence the LTCG on sale of Debentures is not exempt from tax. It is taxable at special rate of 20 percent

Originally posted by : tarkeshwar
	dear friend LTCG is exempt U/s 10(38) of the Income tax act 1961 subject to the following condition 1. The capital assets must be equity shares or units of equity oriented mutual fund 2. transfer of said capital assets must be charged to STT Hence the LTCG on sale of Debentures is not exempt from tax. It is taxable at special rate of 20 percent

agreed 

it is taxable

Sir According to sec.10(38) Long term cap. gain is exempt only for Listed Securities not for debentures and bonds

however there is a provision for debentures and bonds that assessee shall dep. tax @ 10% without indexation or 20% with indexation it is depend on the assessee to choose the option

fully agreed with tanuj sharma

agreed with others.

agree with tanuj

yes i aggree with tarkeshwar,

but i added 1 point is, when we have an LTCG on sales of debenture, that time the cost of debenture, not applicable d Indexation criteria,

keep sharing,

As far as the provisions of the Income Tax Act are concerned , no indexing benefit is available on debentures and bonds, hence they are fully taxable @ 20% special rate.

Originally posted by : tarkeshwar
	dear friend LTCG is exempt U/s 10(38) of the Income tax act 1961 subject to the following condition 1. The capital assets must be equity shares or units of equity oriented mutual fund 2. transfer of said capital assets must be charged to STT Hence the LTCG on sale of Debentures is not exempt from tax. It is taxable at special rate of 20 percen

agree with Jignesh...no indexation on debenture, bonds other than Indexed Bond ( issued by Govt.) under 3rd Proviso to sec. 48

Long term capital gain on the sale of debenture is not exempt. It is chargeable to tax if listed @ 10% otherwise @ 20%. Benifit of Indexation shall not be avaialble as per third proviso to section 48.

Dear all,

Indexation is not at all applicable to the debentures as stated in third proviso to section 48 therefore long term capital gain on redemption of debentures is taxable at the rate of 20% flat.