Capital conundrum

 Under the Indian Income Tax law, the method and rules about capital gains and tax payable thereon are quite involved.

 The rates differ according to the asset sold and then, in some cases indexation is applicable and in others it is not. There are certain rules to be followed for carry forward and set-off of loss too.

 As a tax consultant it is my job to know these things. However, ever so often, just when you think that you have mastered a subject there comes along a twist, which takes you by surprise.

 This is precisely what happened when I was doing what I thought was a routine computation for one of my clients.

 Before continuing further, let me quickly go through the ground rules of capital gains taxation to enable us have a better fix on the problem.

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