Set off and carry forward of capital loss

[anil kalia]

Whether any capital loss on the transactions not covered under section 10(38) or section 111A is required to be set off against income on transactions covered under section 10(38), to determine the carry forward loss to be yet off in future as per the provisions of Income Tax Act

AI Summary

Clarification on Set-Off of Capital Loss: Losses from Non-Exempt Transactions Cannot Offset Tax-Exempt Income under Sections 74 and 70(2). A query was raised regarding the set-off and carry forward of capital loss under the Income Tax Act, specifically whether losses from transactions not covered under sections 10(38) or 111A should be set off against income from transactions covered under section 10(38). The response clarified that under sections 74 and 70(2), losses from capital assets not eligible for exemption under section 10 cannot be set off against tax-exempt income, as such income does not form part of the taxable or gross total income.