Set off of loss on block

[DEVKUMAR KOTHARI]

S.2(42A,50,71and74. S. 50 is not withstanding S.2(42A).S.71 and 74 has to be ead with S.2(42A). Therefore, deemed STCG u/s 50 which is really on transfer of a long-term asset, can be set off against other LTC Loss. Similarly deemed STC Loss u/s 50, which in reality is on transfer of a LTCa asset can only be set off aginst LTC gain on other assets. Suppose block I is fully long-term and on that there is loss. Block II is short term and long term both and there is gain. Whetehr the loss on Block I can be set off against Block II gains. Whether Loss on Block I can be set off against gain on any other capital asset, becasue it is deed as short term u/s 50. Possible view is that S.50 apply only in case of gain and not in case of loss. and that for S.71 and 74 period of holdig is to be considered even while considering set off of loss in one block and gains in other block where in both block S 50 apply.

AI Summary

Can Long-Term Capital Losses Offset Mixed-Term Gains Under Section 50 of Income Tax Act? Clarification Needed. A query was raised regarding the set-off of losses for tax purposes, specifically addressing whether losses from long-term capital assets (Block I) can be offset against gains from mixed-term assets (Block II) under Section 50 of the Income Tax Act. The question considers whether Section 50, which typically applies to gains, also applies to losses, and how Sections 71 and 74 should be interpreted concerning holding periods. The response requested further clarification and examples to better understand the application of these provisions.