income from capital gains (jan26)

1. If bonus shares are acquired before 1.4.2001, the cost of acquisition of such bonus share shall be:

a) Nil

b) FMV of such bonus share on the date of allotment

c) FMV as on 1.4.2001

d) None of the above

None

2. If bonus shares are acquired on or after 1.4.2001, the cost of acquisition of such shares shall be:

a) FMV of such shares on the date of allotment

b) Nil

c) Proportionate cost of original shares

d) None of the above

None

3. The cost of acquisition of the right shares to a person who purchased the right to acquire the share from the existing shareholder shall be:

a) FMV of right share on the date of allotment

b) Price at which these shares are offered

c) Price at which these shares are offered plus the amount paid to the person renouncing the right

d) None of the above

None

4. Maya had bought 3,000 listed shares of a company on 25.04.2023 at ₹ 300 per share and STT was paid on it. The company announces and allots bonus shares in the ratio of 1:3 on 01.04.2024. After the allotment of bonus shares, the shares were sold by Maya on 10.06.2024 at ₹ 400 per share and STT was paid on it. Compute the amount of capital gain/loss in her hands for AY 2025-26. {CII – FY 2023-24: 348; FY 2024-25: 363}

a) LTCG of ₹ 7,00,000.

b) LTCG of ₹ 3,00,000 on sale of original shares; STCG of ₹ 4,00,000 on sale of bonus shares.

c) LTCG of ₹ 6,61,207.

d) LTCG of ₹ 2,61,207 on sale of original shares; STCG of ₹ 4,00,000 on sale of bonus shares.

None

5. XYZ & Co, a partnership firm, owns a house property which is utilized by the partners for their residence. On 30.06.2024, the firm sells the property at a LTCG of ₹ 3,50,000. Can the firm or partners claim exemption u/s 54?

a) Yes, the firm can claim exemption u/s 54 as the firm has earned LTCG from the transfer of a residential house.

b) Yes, the partners can claim exemption u/s 54 as the property was used by them for residential purpose and the property has been indirectly transferred by the partners only in the capacity of a firm.

c) Neither the firm nor the partners can claim deduction u/s 54 as the said deduction is allowed only in case of a commercial property.

d) The firm cannot claim deduction u/s 54 as deduction u/s 54 is allowed only to an individual or HUF. Further, the partners cannot claim deduction u/s 54 as the transferor in the instant case is the firm.

None

6. A Ltd is 100% holding company of B Ltd. A Ltd transfers a capital asset (acquired in 2002 for ₹ 50,000) on 16.06.2024 for ₹ 3,70,000 to B Ltd. B Ltd is an Indian company, while A Ltd is a foreign company. The capital asset is transferred as stock-in-trade to B Ltd. Determine whether any capital gains shall be chargeable to tax in the instant case?

a) Any transfer between a holding company and 100% subsidiary company is not treated as a transfer at all. Hence, no capital gains tax liability shall arise.

b) Any transfer between a holding company and 100% subsidiary company is not treated as a transfer if the transferee company is an Indian company. Hence, no capital gains tax liability shall arise.

c) A transfer between a holding company and 100% subsidiary company is treated as a “transfer” as there is no specific exclusion in this regard. Hence, capital gains tax liability shall arise.

d) Any transfer between a holding company and 100% subsidiary company is not treated as a transfer if the transferee company is an Indian company. However, this rule is not applicable if the capital asset is transferred as stock-in-trade. Hence, capital gains tax liability shall arise.

None

7. Mr Vaibhav sold his old residential house in April 2023 for ₹ 28,00,000. LTCG arising on transfer of old house amounted to ₹ 8,40,000. In December 2023, he purchased another residential house worth ₹ 5,00,000. The new house was however, sold in April 2024 for ₹ 14,00,000 (SDV of the new house was ₹ 12,00,000). What will be amount of taxable capital gains in the hands of Mr Vaibhav for AY 2024-25 and AY 2025-26?

a) LTCG of ₹ 3,40,000 in AY 2024-25 and STCG of ₹ 14,00,000 in AY 2025-26

b) LTCG of ₹ 3,40,000 in AY 2024-25 and LTCG of ₹ 5,00,000 and STCG of ₹ 14,00,000 in AY 2025-26

c) LTCG of ₹ 3,40,000 in AY 2024-25 and LTCG of ₹ 5,00,000 and STCG of ₹ 9,00,000 in AY 2025-26

d) LTCG of ₹ 3,40,000 in AY 2024-25 and LTCG of ₹ 5,00,000 and STCG of ₹ 7,00,000 in AY 2025-26

None

8. Mr B acquires 1,000 equity shares on 01.01.2017 at ₹ 200. FMV of the said shares on 31.01.2018 is ₹ 500. Mr B sells the said shares on 30.04.2024 at ₹ 400. Calculate the amount of capital gains in the hands of Mr B, assuming that STT has been paid by Mr B on acquisition and transfer of the said equity shares.

a) Nil

b) (-) ₹ 1,00,000

c) ₹ 2,00,000

d) ₹ 3,00,000

None

9. Ms Jaya acquires 5,000 equity shares on 01.01.2016 at ₹ 500. The Fair Market Value of the said share on 31.01.2018 is ₹ 250 and on 31.03.2018 is ₹ 600. She sells the said shares on 30.04.2024 at ₹ 700. Calculate the amount of LTCG in the hands of Ms Jaya assuming that STT has been paid by her on acquisition and transfer of the said equity share. {CII – FY 2015-16: 254; FY 2024-25: 363}

a) ₹ 10 lakhs

b) ₹ 22.50 lakhs

c) No capital gains

d) ₹ 5 lakhs

None

10.

a) Only business profits of ₹ 2,50,000 shall be chargeable to tax in the hands of Tina in AY 25-26.

b) Only LTCG of ₹ 6,11,440 shall be chargeable to tax in the hands of Tina in AY 25-26.

c) Business profits of ₹ 2,50,000 and LTCG of ₹ 2,90,724 shall be chargeable to tax in the hands of Tina in AY 25-26.

d) Business profits of ₹ 2,50,000 and LTCG of ₹ 3,61,440 shall be chargeable to tax in the hands of Tina in AY 25-26.

None

11. Mr A (aged 45 years) sold an agricultural land for ₹ 52 lakhs on 04.05.2024 acquired at a cost of ₹ 49.25 lakhs on 13.09.2023 situated at 7 kms from the jurisdiction of municipality having population of 4,00,000 and also sold another agricultural land for ₹ 53 lakhs on 12.06.2024 acquired at a cost of ₹ 46 lakhs on 15.02.2023 situated at 1.5 kms from the jurisdiction of municipality having population of 12,000. What would be the amount of capital gain chargeable to tax in the hands of Mr A for AY 25-26? Cost inflation index for FY 2022-23 is 331; for FY 2023-24 is 348 and for FY 2024-25 is 363.

a) Short-term capital gain of ₹ 9.75 lakhs

b) Short-term capital gain of ₹ 7 lakhs

c) Long-term capital gain of ₹ 2,50,158

d) Long-term capital gain of ₹ 2,72,212

None

12. Mr Rana is a resident of India residing in Meerut. During FY 2011-12, he purchased an agricultural land situated in Bahadurpur for ₹ 10 lacs. This land is situated in an area which has aerial distance of 3 km from the local limits of Municipality of Bahadurpur. Total population of this area is 80,000 as per the last preceding census. During FY 2024-25, Mr Rana sold this land to Mr Jeet for ₹ 25 lakhs on 29.5.2024. Mr Rana invested ₹ 5 lakhs in bonds of NHAI on 31.10.2024. CII for FY 2011-12 and FY 2024-25 is 184 and 363 respectively. Compute the amount of capital gain taxable in the hands of Mr Rana for AY 2025-26:

a) ₹ 27,174

b) ₹ 5,27,174

c) ₹ 15,00,000

d) None of the above

None

13. Neha sold her residential house for ₹ 85 lakhs on 11.08.2024. Value adopted by the Stamp Valuation Authority on the date of registration of the Conveyance Deed (ie, 17.08.2024) was ₹ 150 lakhs. Neha disputed the valuation done by the said authority before the Assessing Officer and filed an application before him to refer her case to the Valuation Officer. The Valuation Officer determined the value of the house on date of registration of Conveyance Deed at ₹ 160 lakhs. In light of these facts, compute the full value of consideration to be taken in case of Neha for the purpose of calculation of capital gains in her hands.

a) ₹ 85 lakhs

b) ₹ 150 lakhs

c) ₹ 160 lakhs

d) ₹ 89.25 lakhs

None

14. Suman is a CA practicing in Mumbai since Sept 1994. She transfers her practice to another Chartered Accountant Smita on 19.06.2024 and charges ₹ 14,50,000 towards goodwill. Determine the tax implications that may arise in the hands of Neha on account of transfer of her practice to Smita.

a) ₹ 14.5L shall be charged to tax as capital gains

b) ₹ 14.5L shall be charged to tax as income from other sources

c) ₹ 14.5L shall be charged to tax as income from profession

d) No tax implications shall arise

None

15. A building was acquired on 1.4.1995 for ₹ 20,00,000 and sold for ₹ 90,00,000 on 01.06.2024. SDV on the date of transfer was ₹ 95,00,000. FMV of building on 1.4.2001 was ₹ 24,00,000. Its SDV on the same date was ₹ 22,00,000. Determine the capital gains on sale of such building for AY 2025-26? CII for FY 2001-02 is 100 and for FY 2024-25 is 363.

a) ₹ 10,14,000

b) ₹ 15,14,000

c) ₹ 7,88,000

d) ₹ 2,88,000

None

Name

Phone

Topic - Income From Capital Gains (Sections 45 to 55A)

Topic -
Income From Capital Gains
(Sections 45 to 55A)