Short Term/Long Term Capital Gain

[SITARAM AGRAWAL]

1. Pvt Ltd.Co. Closed business in the A.Y. 11-12.  No Business Transaction.

2. Co. Not dissolved.

3. Claimed depreciation up to 31-03-2010- Long Term Asset.

4. Depreciation Not claimed in the year -31-03-2011

5. Sales Long Term Asset in A.Y. 2012-13

6. Whether Taxable u/s.112 of Income Tax Act, 1961

Pl. Guide.

Thanks,

AGRAWAL SITARAM C.

AI Summary

Depreciable asset sale treated as short-term capital gain and taxed under normal capital gains provisions, not long-term.
Sale of a depreciable business asset that remained in the block of assets is treated as a short-term capital gain governed by depreciation recapture and block-of-assets rules, irrespective of whether depreciation was claimed in the immediately preceding year; such short-term capital gain treatment is subject to set-off against long-term capital gains and to applicable capital gains reinvestment reliefs where statutory conditions are met.