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2010 (4) TMI 211 - HC - Income TaxComputation of capital gains – sale of shares – indexation – section 112(1) - the assessee entered into eight sale transactions involving the shares of four companies. Of the sale transactions, the shares of Infosys Technologies comprised entirely of bonus shares where the cost of acquisition was nil. The bonus shares of Infosys Technologies were sold for a consideration of Rs.6.13 Crores. There being no cost of acquisition, the long term capital gains were computed at Rs.6.13 Crores. Out of the remaining seven transactions one sale resulted in a long term capital gain of Rs.9.47 lacs with indexation whereas in the remaining transactions the assessee reported a loss of Rs.2.78 Crores with indexation. The assessee set off the long term capital loss of Rs.2.68 Crores from the long term capital gains of Rs.6.13 Crores and paid a tax of 10% on the net long term capital gain of Rs.3.45 Crores. – AO denied the benefit of indexation – Held that: Tribunal was justified in coming to the conclusion that the assessee’s claim of computation of long term capital gains on the sale of shares other than the bonus shares of Infosys Technologies, after giving the benefit of indexation was in consonance with the proviso to Section 112(1) and that the assessee was assessable to net long term capital gain of Rs.3.45 Crores.
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