Understanding Long-Term Capital Gains: Indexed Cost Benefits and Exceptions for Bonds, Shares, and Foreign Investments

The calculation of long-term capital gains for income tax purposes, emphasizing the use of "Indexed Cost of Acquisition" and "Indexed Cost of Improvement" instead of their non-indexed counterparts. It specifies scenarios where indexation benefits are not applicable, such as with capital assets like bonds, debentures, shares acquired with convertible foreign exchange, depreciable assets, slump sales, units purchased in foreign currency, GDRs, and securities transferred by Foreign Institutional Investors. The guidelines apply to various entities, including non-residents, offshore funds, and resident individuals.