Capital Gain
Unit III
Capital & Revenue Receipts
Capital Receipts Revenue Receipts
(a) Receipts derived from activities which
(a) Receipts related to NORMAL
are not part of the normal trading
ACTIVITIES of the business
activities of the business
(b) Receipt on account of fixed capital is (b) Whereas a receipt on account of
Capital Receipt circulating capital is Revenue Receipt
(c) Appears as capital or liabilities in the (c) Credited as revenue to Trading and
Balance Sheet Profit & Loss Account
(d) Capital receipt is an amount received (d) Receipt in place of income is a revenue
as fixed capital receipt.
(e) Examples: receipts from sales of goods
(e) Examples: receipts of cash brought in
and services, rent, commission and
by partners, shareholders, debenture
interest on bank deposits received by the
holders and bank loans
business.
Capital Gains
Basis of Charge: [ 45 (1) ]
Any profits or gains arising out of the transfer of a
capital asset effected in the previous year shall be
chargeable to income-tax under the head Capital Gains
and shall be deemed to be the income of the previous
year.. Unless it is exempt under section 54, 54B, 54D,
54EC, 54F, 54G and 54GA.
Capital Assets
Capital Asset however does not include
Stock in Trade
personal effect such as movable property except jewelry
agricultural land in India
Gold Deposit Bonds issued under the Gold Deposit
Scheme 1999.
However, capital asset includes property of every kind
whether tangible or intangible..
Types of Capital Assets
Short Term Capital Assets
Long Term Capital Assets
Short Term Capital Asset as per section 2(42A) is a
capital asset held by an assessee for not more than 36
months. However, in case of a) Equity or Preference
shares held in the Company b) Any listed security. 3)
Units of UTI or Mutual Fund Units under Section 10
(23D) , the assets held for less than 12 months will be
Short Term Capital Assets..
The Capital assets not fulfilling the above criteria will be
treated as Long Term Capital Assets.. 2(29A).
Transfer includes….
1) Sale
2) Exchange
3) Relinquishment of the asset/extinguishment of rights
in an asset
4) compulsory acquisition thereof under any law
5) when Capital Asset is converted into stock in Trade.
6) when possession of property is foregone in discharge
of any collateral contract under transfer of property
Act.
Transfer does not include….
Where the assets are distributed to the shareholders on liquidation, such
transfer will not be regarded as transfer in the hands of the Company.
Any transfer by the company to its 100% subsidiary company provided
the later is an Indian Company.
Any transfer in the scheme of amalgamation of a capital asset by the
amalgamating company to the amalgamated company.
Any transfer by way of conversion of bonds or debentures, debenture-
stock or deposit certificates in any form, of a company into shares or
debentures of that company.
Any transfer under the security Lending Scheme,1997 for lending of
any securities under an agreement or arrangement,which the assessee
has entered into with the borrower of such securities and which is
subject to the guidelines issued by SEBI or RBI in this regard.
Here , we are dealing only with taxation of corporate assessees
therefore, aspects of Non-Corporate Taxation have been deleted from
the material…
Computation of Short Term Capital
Gain
Sr. No. Particulars Rs.
1 Full Value of Consideration xxx
2 (Less) a) Expenditure incurred wholly and xxx
exclusively in Connection with such a transfer.
(b) Cost of Acquisition xxx
(c) Cost of Improvement xxx
3 Gross Short term Capital Gain xxx
4 (Less) Exemption, if available u/s 54B, 54D, 54G xxx
and 54GA
5 Taxable Short Term Capital Gain xxx
Computation of Long Term Capital
Gains
Sr. No. Particulars Rs.
1 Full Value of Consideration xxx
2 (Less) a) Expenditure incurred wholly and xxx
exclusively in Connection with such a transfer.
(b) Indexed Cost of Acquisition xxx
(c) Indexed Cost of Improvement xxx
3 Gross Long Term Capital Gain xxx
4 (Less) Exemption, if available u/s 54, 54B, 54D, xxx
54EC, 54F, 54G and 54GA
5 Taxable Long Term Capital Gain xxx
Cost of Acquisition
Cost of acquisition of an asset is the value for which it
was acquired by the assessee. Expenses of capital
nature for completing or acquiring the title to the
property are includible in the cost of acquisition.
Indexed Cost of Acquisition ( Sec. 48)
In the case of long-term capital gain, indexed cost of
acquisition and indexed cost of improvement are
deducted.
Indexed Cost of Acquisition means an amount which
bears to the cost of acquisition, the same proportion as
cost inflation index for the year in which the asset is
transferred bears to the cost inflation Index for the first
year in which the asset was held by the assessee or for
the year beginning on 01-04-1981 whichever is later.
Cost Inflation Index
Financial Year CII Financial Year CII
1981-82 100 1998-99 351
1982-83 109 1999-00 389
1983-84 116 2000-01 406
1984-85 125 2001-02 426
1985-86 133 2002-03 447
1986-87 140 2003-04 463
1987-88 150 2004-05 480
1988-89 161 2005-06 497
1989-90 172 2006-07 519
1990-91 182 2007-08 551
1991-92 199 2008-09 582
1992-93 223 2009-10 632
1993-94 244
1994-95 259
1995-96 281
1996-97 305
1997-98 331
Calculation of Indexed Cost of
Acquisition
Fair Market Value of the asset on
April 1, 1981 or cost of acquisition,
which ever is more X Cost Inflation index for the year in
Cost inflation index which the asset is transferred
Calculation of Indexed Cost of
improvement
Cost of improvement (ignoring any
cost of improvement incurring prior
to April 1, 1981) X Cost inflation index for the year in
Cost inflation index for the year in which the asset is transferred
which improvement took place
Example 1
X purchases a house property for Rs. 76,000 on June 30,
1967. The following expenses are incurred by him for making
addition/alteration to the house property:
Cost of Construction of first floor in 1975-76 Rs. 1,10,000.
Cost of Construction of Second floor in 1982-83 Rs. 4,40,000.
Alteration/reconstruction of the property in 1989-90 Rs.
2,90,000.
Fair value of the property on April 1, 1981 is Rs. 6,50,000.
The house property is sold by X on June 15, 2009 for Rs.
75,00,000 (expenses incurred on transfer Rs. 50,000)
Compute long term capital gain.
Example 2
X sells the following capital assets during the previous
year 2009-10
Particulars Shares Self Generated House
Goodwill property
Sale Consideration 9,50,000 15,00,000 3,15,700
Year of Acquisition 1991-92 N.A. 1983-84
Cost of Acquisition 2,90,000 -- 18,000
Cost of improvement on 1989-90 -- -- 10,000
Example 3
X purchase a house property for Rs. 26,000 on May 10,
1962. He gets the first floor of the house constructed in
1967-68 by spending Rs. 40,000. he dies on september
12, 1978. The property is transferred to Mrs. X by his
will. Mrs. X spends Rs. 30,000 and Rs. 36,700 during
1979-80 and 1984-85 respectively for renewal/
reconstruction of the property. Mrs. X sell the house
property for Rs. 24,50,000 on March 15,2010
(brokerage paid by Mrs. X Rs. 24,500). The fair market
value of the house on April 1, 1981 is Rs. 2,68,000.
Compute long term capital gain.
Example 4
X purchases a property on April 1, 1976 for Rs. 95,000. He enters intro agreement
for sale of the property to A on November 1, 1982 and receives Rs. 10,000 as
advance. A could not, however, keep his promise and the advance of Rs. 10,000
given by him is forfeited by X. Later on he gifts the property to his friend Y on
May 15, 1984. The following expenses are incurred by X for renewals of the
property:
Addition of two rooms by X during 1978-79 Rs. 35,000.
Addition of first floor by X during 1982-83 Rs. 45,000.
Addition of Second floor by Y during 1989-90 Rs. 1,25,000.
Fair market value of the property on April 1, 1981 is Rs. 2,45,000.
Y enters into an agreement to sell the property for Rs. 8,50,000 to B on April 1,
1994 after receiving an advance of Rs. 50,000. B could not pay the balance within
the stipulated time of two months and Y forfeits the advance of Rs. 50,000 as per
agreement with B. Y ultimately finds a buyer in C to whom property is transferred
for Rs. 23,75,000 on December 1, 2009. Compute the capital gain chargeable to tax
in the hands of Y for the assessment year 2010-11.
Example 5
X ltd. Owns the following assets:-
Particulars Goodwill Shares (non- House
listed) property
Cost of acquisition Self-Generated Rs. 1,38,600 Rs. 96,000
Date of acquisition -- March 10, 2007 March 10, 2007
These capital assets are transferred by X ltd. to its wholly-owned
Indian subsidiary company S ltd. on April 1, 2008. On July 7,
2009, these assets are transferred by S ltd. for consideration of Rs.
10,50,000 (i.e. Goodwill Rs. 6,00,000, Shares Rs. 2,15,700 and
house property Rs. 2,34,800). Compute the capital gain chargeable
to tax in the case of S ltd. For the assessment year 2009-10.
Example 6
X, Y and Z are three partners of a firm. On March 10, 2010 the firm is dissolved.
The following assets are distributed to partners:
Particulars Residential Non-listed Land to Z
House to X shares to Y
Fair Market value on March 10, 2010 22,90,000 60,000 42,000
Agreed value as per dissolution deed 12,70,000 66,000 42,000
Cost of acquisition 50,000 15,000 8,000
Year of acquisition 1949-50 1992-93 1984-85
Fair Market value on April 1, 1981 3,20,000 N.A. N.A.
Determine the amount of chargeable capital gains of the firm for the assessment year
2010-11
Example 7
X converts his capital assets (acquired on June 10,
1967 for Rs. 70,000, fair market value on April 1,
1981: Rs. 1,80,000) into stock in trade on April 1,
1984 (fair market value: Rs. 4,80,000) and,
subsequently, sells the stock in trade so converted for
Rs. 7,30,000 on June 10, 2009. Determine the amount
of Capital Gains and assessable profits.
Example 8
The Central Government acquires a house property owned by
X on October 17, 1995. This property was purchased on April
10,1976 for Rs. 76,000 (Cost of improvement incurred during
1986-87: Rs. 40,000 and fair market value of the property on
April 1, 1981 was Rs. 1,42,000). The Government awards Rs.
5,77,000 as compensation which is received partly (Rs. 77,000)
on May 13, 2009 and partly (Rs. 5,00,000) on April 1, 2010.
Being aggrieved against the award, X files an appeal. The
Court, as per order dated August 12, 2011, enhanced the
compensation from Rs. 5,77,000 to Rs. 9,50,000 (legal
expenses incurred by X: Rs. 20,000). X receives the additional
compensation of Rs. 3,73,000 on April 15, 2012. Compute the
income of X under the head “Capital Gains”. Does it make any
difference if the additional compensation is received by his
sons A and B (share of each being 50%) on April 15, 2012 after
the death of X?
Example 9
X purchases a house property in 1995. It is compulsorily acquired
by the Government on April 20, 2008 (Indexed Cost of
Acquisition is Rs. 40,000). Compensation paid by the Government
on May 6, 2009: Rs. 6,00,000. The Delhi High Court increases the
compensation from Rs. 6,00,000 to Rs. 9,30,000 on the appeal
filed by X ( legal expenditure incurred by X: Rs. 10,000). The
Government on June 10, 2011 pays the additional compensation
of Rs. 3,30,000 but Government files an appeal in the Supreme
Court against the judgment of the Delhi High Court. The Supreme
Court reduces the quantum of compensation from Rs. 9,30,000 to
Rs. 7,50,000 by the judgment dated March 20, 2013. X repays Rs.
1,80,000 to the Government on April 6, 2013. Legal expenditure
incurred by X in Supreme Court is Rs. 25,000.
Capital gains on transfer of bonus shares
Different Situation Specified Provision
Cost of Acquisition of bonus shares Fair Market Value on April 1, 1981 is
allotted before April 1, 1981 taken as cost of acquisition
Cost of acquisition of bonus shares Cost of acquisition is taken as zero
allotted after April 1, 1981
Period of holding Bonus shares The period of holding shall be
determined from the date of allotment
of Bonus shares and not from the date
of acquisition of original shares.
Example 10
X purchases 1,000 equity shares in A Ltd. @ of Rs. 16
per share ( brokerage 1%) on December 10, 1979. He
gets 500 bonus shares (by virtue of his holding of
1,000 shares) on January 10, 1984. Fair market value
of shares of A Ltd. On April 1, 1981 is Rs. 24. On
April 13, 2009, he transfers 1,000 original shares @
Rs. 81 per share (brokerage 1.5%).
On April 15, 2009, he transfers 500 bonus shares @
Rs. 87 per share (brokerage 1.5%). These shares are
transferred in the Bombay Stock Exchange.
LTCG on transfer of securities not chargeable
to tax in cases covered by STT
Conditions for exemption
Taxpayer is an Individual, HUF, firm or company or any other
taxpayer.
The asset which is transferred is a Long term capital asset.
Such asset is equity share in a company or units of equity
oriented mutual fund.
Such transactions takes place on or after October 1, 2004.
At the time of transfer the transaction is chargeable to
Securities Transaction Tax
If the above conditions are satisfied, LTCG is exempt from
tax. It may be noted that in the cases given above the
capital gain is short term capital gain, by virtue of section
111A, it is taxable @ 15% (+ SC + EC + SHEC).
Example 11
X holds 1,000 equity shares in A ltd. Since 1978 (cost
of acquisition Rs. 10,000, fair market value on April 1,
1981 Rs. 16,000). A ltd. Offers 2,000 right shares of
Rs. 10 each to X on May 1, 2009 at a premium of Rs.
50. X subscribes for 800 right shares and renounces
1200 shares in favour of C by transferring the right
entitlement for a consideration of Rs. 4,800. X sells
1,800 shares in A ltd. On March 30, 2010 @ Rs. 110
per share. C also transfers his 1,200 shares @ Rs. 111
per share on March 31, 2010.
Capital Gains
exempt from Tax
Section 54
Who can claim exemption?
Individuals/Hindu Undivided Family
Which capital asset is eligible for exemption?
Long-term
Which specific asset is eligible for exemption?
A residential house property
Which capital asset a taxpayer should acquire to get the benefit of exemption?
Residential House Property
What is time limit for acquiring the new asset?
For purchase: 1 year backward or 2 years forward
For Construction: 3 years forward
From which date the time limit shall be determined?
From the date of transfer of house property, but in case of compulsory acquisition from the date of receipt of
compensation
How much is exempt?
Investment in new asset or capital gain, which ever is lower.
Is it possible to revoke the exemption in subsequent years?
If the new asset is transferred within 3 years of its acquisition.
When the exemption is revoked it is taxable in the year in which the default is committed. What will be the
status of the notional income?
Short Term Capital gain
Whether the scheme of deposit is applicable?
Yes
Scheme of Deposit
If the new asset is not acquired up to the due date of submission of return
of income, then the taxpayer will have to deposit the money in “Capital
Gain deposit account scheme” with a nationalized bank. The proof of
deposit should be submitted along with return of income. On the basis of
actual investment and the amount deposited in the deposit account,
exemption will be given to the taxpayer.
The taxpayer can acquire a new asset by withdrawing from the deposit
account. But the new asset should be acquired as the time limit. If the
deposit account in not fully utilized for acquiring the new asset, the
unutilized amount will become chargeable to tax in the previous year in
which the specified time limit expires (but in case of section 54F it is
unutilized amount/net consideration x capital gains). It will be taxable as
short term/ long term capital gain depending upon the original capital gain.
The unutilized amount can be withdrawn by the taxpayer after the expiry
of the aforesaid time limit.
Section 54B
Who can claim exemption?
Individuals
Which capital asset is eligible for exemption?
Short Term/ Long-term
Which specific asset is eligible for exemption?
Agricultural Land if it was used by the individual or his parents for agricultural purposes for atleast 2 years immediately
prior to transfer.
Which capital asset a taxpayer should acquire to get the benefit of exemption?
Agricultural land (may be in rural areas or urban areas)
What is time limit for acquiring the new asset?
2 years forward
From which date the time limit shall be determined?
From the date of transfer of agricultural land
How much is exempt?
Investment in new asset or capital gain, which ever is lower.
Is it possible to revoke the exemption in subsequent years?
If the new asset is transferred within 3 years of its acquisition.
When the exemption is revoked it is taxable in the year in which the default is committed. What will be the
status of the notional income?
Short Term Capital gain
Whether the scheme of deposit is applicable?
Yes
Section 54D
Who can claim exemption?
Any Person
Which capital asset is eligible for exemption?
Short Term/ Long-term
Which specific asset is eligible for exemption?
Land or Building which is forming part of an industrial undertaking which is compulsorily acquired by the Government
and which is used for 2 years for industrial purposes prior to its acquisition.
Which capital asset a taxpayer should acquire to get the benefit of exemption?
Land or Building for industrial purposes
What is time limit for acquiring the new asset?
3 years forward
From which date the time limit shall be determined?
From the date of receipt of compensation.
How much is exempt?
Investment in new Capital asset or capital gain, which ever is lower.
Is it possible to revoke the exemption in subsequent years?
If the new asset is transferred within 3 years of its acquisition.
When the exemption is revoked it is taxable in the year in which the default is committed. What will be the
status of the notional income?
Short Term Capital gain
Whether the scheme of deposit is applicable?
Yes
Section 54EC
Who can claim exemption?
Any Person
Which capital asset is eligible for exemption?
Long-term
Which specific asset is eligible for exemption?
Any Long term capital asset.
Which capital asset a taxpayer should acquire to get the benefit of exemption?
Bonds of National Highway Authority of India or Rural Electrification Corporation
What is time limit for acquiring the new asset?
6 months forward
From which date the time limit shall be determined?
From the date of transfer of long term capital asset, but in case of compulsory acquisition from the date of receipt of
compensation
How much is exempt?
Investment in new Capital asset or capital gain, which ever is lower.
Is it possible to revoke the exemption in subsequent years?
If the new asset is transferred or it is converted into money or a loan is taken on security of the new asset within 3 years
of its acquisition.
When the exemption is revoked it is taxable in the year in which the default is committed. What will be the
status of the notional income?
Long Term Capital gain
Whether the scheme of deposit is applicable?
No
Section 54F
Who can claim exemption?
Individual/Hindu Undivided Family
Which capital asset is eligible for exemption?
Long-term
Which specific asset is eligible for exemption?
Any Long term capital asset (other than a residential house property) provided on the date of transfer the taxpayer does not own
more than one residential house property (except the new house as stated below).
Which capital asset a taxpayer should acquire to get the benefit of exemption?
A residential house property
What is time limit for acquiring the new asset?
For purchase: 1 year backward or 2 years forward
For construction: 3 years forward
From which date the time limit shall be determined?
From the date of transfer of capital asset, but in case of compulsory acquisition from the date of receipt of compensation
How much is exempt?
Investment in new Capital asset/Net consideration x Capital gain
Is it possible to revoke the exemption in subsequent years?
If the new asset is transferred within 3 years of its acquisition, or
If another residential house is purchased within 2 years of transfer of original asset, or
If another residential house is constructed within 3 years of the transfer of original asset
When the exemption is revoked it is taxable in the year in which the default is committed. What will be the status of
the notional income?
Short Term Capital gain
Whether the scheme of deposit is applicable?
Yes
Section 54G
Who can claim exemption?
Any Person
Which capital asset is eligible for exemption?
Short term/ Long-term
Which specific asset is eligible for exemption?
Land, building, plant or machinery in order to shift an industrial undertaking from urban area to rural area
Which capital asset a taxpayer should acquire to get the benefit of exemption?
Land, building, plant or machinery in order to shift an industrial undertaking from urban area to rural area
What is time limit for acquiring the new asset?
1 year backward and 3 years forward
From which date the time limit shall be determined?
From the date of transfer
How much is exempt?
Investment in new Capital asset or capital gain which ever is lower
Is it possible to revoke the exemption in subsequent years?
If the new asset is transferred within 3 years of its acquisition.
When the exemption is revoked it is taxable in the year in which the default is committed. What will be the
status of the notional income?
Short Term Capital gain
Whether the scheme of deposit is applicable?
Yes
Section 54GA
Who can claim exemption?
Any Person
Which capital asset is eligible for exemption?
Short term/ Long-term
Which specific asset is eligible for exemption?
Land, building, plant or machinery in order to shift an industrial undertaking from urban area to any Special Economic Zone
Which capital asset a taxpayer should acquire to get the benefit of exemption?
Land, building, plant or machinery in order to shift an industrial undertaking from urban area to any Special Economic Zone
What is time limit for acquiring the new asset?
1 year backward and 3 years forward
From which date the time limit shall be determined?
From the date of transfer
How much is exempt?
Investment in new Capital asset or capital gain which ever is lower
Is it possible to revoke the exemption in subsequent years?
If the new asset is transferred within 3 years of its acquisition.
When the exemption is revoked it is taxable in the year in which the default is committed. What will be the
status of the notional income?
Short Term Capital gain
Whether the scheme of deposit is applicable?
Yes
Example 12
X gives the following information:-
Residential House Property situated at Kolkata:
Date of Transfer December 30, 2009
Date of Purchase June 30, 1992
Sales Consideration Rs. 35,00,000
Cost of Acquisition Rs. 2,00,000
Expenses on Transfer Rs. 40,000
Amount deposited in Capital Gain deposit account scheme on July 20,2010 Rs. 21,00,000
To get the exemption u/s 54, the following residential house property is purchased at
Chennai by X by withdrawing from the deposit account:
Date of Purchase June 20, 2011
Cost of acquisition Rs. 15,00,000
Find out the following:
a. Capital gains chargeable to tax for different assessment years;
b. X does not want to purchase or construct another property, what is the earliest date
when he can withdraw the unutilized amount from the deposit account, and
c. Is it possible to take back the exemption given u/s 54 in a subsequent year.
Example 13
X sells agricultural land in Kolkata for Rs. 44,73,960
on July 1, 2009, which was purchased by him in 1982-
83 for Rs. 6,80,000. On July 13, 2009 he purchases
agricultural land of Rs. 40,000 in Delhi. On June 30,
2010, he deposits Rs. 3,90,000 in the Deposit Account.
Determine the amount of Capital Gain and exemption
u/s 54B.
Example 14
On January 2, 2010, X sells gold for Rs. 3,85,000 (cost
of acquisition on March 10, 1994: Rs. 1,05,000).
Expenses on purchase and transfer are Rs. 100 and Rs.
200 respectively. On May 30, 2010, he acquires bonds
of National Highway Authority of India (investment
being Rs. 40,000). These bonds are redeemable after
42 months. Find out the amount of Capital Gains and
amount of exemption u/s 54EC.
Example 15
X Ltd. Sells the following assets:-
Particulars Agricultural Bonus Shares House Property
Land (Let Out)
Date of Sale 30/11/2009 1/01/2010 25/03/2010
Date of Acquisition 9/05/1993 4/04/1983 6/06/1982
Sales Consideration 9,00,000 2,50,000 6,00,000
(Rs.)
Purchase Consideration 70,000 Nil 1,00,000
The agricultural land is situated in urban area and used for
agricultural purpose since 1994. X Ltd. Invests in the following
assets during April 2010:
Bonds of National Highway Authority of India (redeemable on
1/06/2013): Rs. 4,00,000
Bonds of Rural Electrification Corporation (redeemable on
May 10, 2015): Rs. 5,00,000
Agricultural Land: Rs. 75,000
Example 16
X Sells the following long-term capital assets on
11/01/2010
Particulars Residential Gold Silver Diamonds
House
Property
Sale Consideration 3,90,000 8,10,000 2,96,000 6,40,200
Indexed Cost of Acquisition 70,000 1,15,000 1,78,000 4,30,000
Expenses on Transfer 10,000 81,000 6,000 32,000
The due date of filing return of income for the assessment
year 2010-11 is 31/07/2010. For claiming exemption u/s 54
and 54EC, X purchases the following assets
….Cont
Assets Date of Amount
Acquisition Rs.
Land (for construction of residential house) 31/03/2010 1,00,000
Bank deposit (for constructing house) 5/08/2010 50,000
Rural Electrification Corporation (redeemable 5/07/2010 7,50,000
on 5/07/2014)
Bonds of National Highway Authority of 10/07/2010 3,05,000
India (redeemable on 10/08/2019)
Find out the amount of Capital Gains chargeable to tax for the
assessment year 2010-11
Example 17
X sells shares in a private limited company on 10/07/2009 for
Rs. 8,05,000 (cost of acquisition on 15/06/1984: Rs. 60,000,
expenses on transfer : Rs. 5,000). On 10/07/2009, he owns
one residential house property. To get the benefit of
exemption u/s 54F, X deposits on 30/07/2010 Rs. 6,00,000 in
Capital Gain Deposit Account Scheme. By withdrawing from
the Deposit Account, he purchases a residential house
property at Delhi on 6/07/2011 for Rs. 4,80,000. Ascertain:
The amount of capital gain chargeable to tax for the
assessment year 2010-11;
Tax treatment of the unutilized amount;
When can he withdraw the unutilized amount; and
What X has to do to ensure that exemption u/s 54F is never
taken back
Example 18
X purchases 1,000 non-listed shares in Y ltd. On
August 16, 1990 for Rs. 8,000. On May 17, 1992, he
gets 500 bonus shares. On October 20, 2008 he
acquires 1,500 right shares @ Rs. 11 per share. He
sells 3,000 shares in Y Ltd. on February 12, 2010 @
Rs. 110 per share (brokerage on sale: 1%)
