Any Capital asset held by the Assessee for 36 months would be termed as Long-term capital asset and any gain arising on account of such sale thereof would constitute a long-term capital gain. As per the ActShort term Capital asset is defined as the capital asset held by an assessee for not more than thirty six months preceding the date of its transfer; Provided that in case of shares and debentures or Units of UnitTrust of India, thirty six months shall be substituted to twelve months.
Related Cases:
S. 2(29A), r/w S. 54 of the IT Act, 1961—Capital gain—As per S. 2(14), 2(42A), a capital asset held by the assessee for 36 months would be termed as a long-term capital asset and any gain arising on account of sale thereof would constitute a long-term capital gain—Vinod Kumar Jain vs. CIT
S. 2(29A), (42A), 45(1) 48 of IT Act, 1961—Capital gain—For the purpose of S. 48 of the Act, one must keep in mind an important principle that chargeability and computation have to go hand in hand. the right to subscribe for additional offer of shares/debentures comes into existence only when the company decides to come out with the rights offer. Computation is an integral part of chargeability under the Act—Navin Jindal vs. ACIT [2010] 320 ITR 708 (SC)
Income Tax Act, 1961, S. 2(29A), 2(42A), 45, 48(2)—Capital gain—Short term loss or long term loss ” In this batch of civil appeals, the narrow issue which arises for determination is the nature of the loss suffered by the appellant(s) [assessee(s)] – Whether Rs. 2,43,750/- was a short-term capital loss, as contended on behalf of the assessee(s), or whether the said loss was a long-term loss, as contended on behalf of the Revenue?” While allowing the civil appeals, the Supreme Court held that:—”The loss suffered by the assessee amounting to Rs. 2,43,750/- was a short-term loss. Therefore, in our view, the computation of income under the head “Capital gains”, as projected in the chart submitted by the assessee and as computed by the assessee is correct. In other words, the computation of income under the head “Capital gains” submitted to this Court by the assessee is correct and the computation of income made by the Department is erroneous.” Navin Jindal vs. ACIT
S. 2(29A) & 2(42A) of the IT Act, 1961—Capital Gain—Shares allotted to employees under ESOP will be deemed to have been held by assessee when he become the full legal owner thereof and not from the date on which the assessee employee accept the offer of ESOP as the employee become only beneficiary owner of shares at the time of acceptance of the offer and capital gain arising in respect of such shares has to be treated as short term or long term depending on the period of holding—Muthuswamy Ravi Kumar vs. ACIT (ITAT-Bang)
S. 2(14), 2(29A), 2(42A) & 2(42B) of the IT Act, 1961—Capital gain—S. 2(29A) and 2(42A) provides that if capital asset is held for more than 36 months immediately after preceding the date of transfer, it will be treated as long-term capital asset and the gain will be considered as long term capital gain but where from the date of conversion of business asset into investment or capital asset upto date of transfer or sale is less than 36 months as provided in S. 2(29A) and 2(42A), the same has to be treated as short term capital gain and the rate applicable in the case of short-term capital gain is leviable—Splendor Constructions Pvt. Ltd. vs. ITO (2009) 122 TTJ 34 (Del)
Capital Gain—S. 2(29A)—IT ACT, 1961—Bharti Gupta Ramola vs. Commissioner of Income-tax.
Reference:
As Per Section 2(29A), of the Income Tax Act, 1961-
In this Act, unless the context otherwise requires,—
S. 2(29A) “long-term capital asset” means a capital asset which is not a short-term capital asset.