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2014 (12) TMI 1192 - ITAT MUMBAILong term capital asset - CIT(A) held that the assessee has been holding the 2000 shares of his employer company M/s I Flex Solutions Ltd as “Legal Owner” for more than one year and hence, it was long term capital asset” - Held that:- found from the record that the assessee has got these shares under a scheme of ESOP wherein the assessee received 250 shares in April 2000 (before the issue of the bonus in October 2000 and September 2003 and split of the shares in two of ₹ 5/- each). However, no basis has been given by the AO for holding that the shares were purchased on 18.12.2006. However, ld. CIT(A) has recorded, finding to the effect that the shares were allotted to the assessee under ESOP scheme in the year 2000 and thereafter bonus shares were issued and there was a split of shares which resulted in total number of shares at 2000, accordingly treated the same as long term capital assets. At no point of time, the ld. DR controverted the finding of CIT(A), by bringing any positive material on record. Accordingly, we do not find any infirmity in the order of ld. CIT(A) for allowing the assessee’s claim of Long Term Capital Gains. See Muthuswamy Ravikumar V/s ACIT [2008 (3) TMI 407 - ITAT BANGALORE-A] wherein held it is the date of grant of the stock option in favour of the assessee that is material for determining the period of holding the asset in question, and not the date on which the option was exercised and stock options were converted into shares. capital gains arising out of the sale of shares acquired through ESOPs have to be assessed as long-term capital gains with consequential benefits of indexation and exemption under s. 54 - Decided in favour of assessee.
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