Question And Answer
Subject: proceeds of Sale of shares of unquoted private limited company
Querist: Rajesh agarwal
Answered by:
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Date: May 7, 2023
Query asked by Rajesh agarwal

ITO added back the entire sale proceeds of the equity shares of unlisted shares of a private limited company. Transaction made during FY 2013-14. Those shares were purchased at almost the same time of sale. A nominal gain arises and added in to other income.

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Unless there is something to justify that the transaction is an accommodation or a bogus transaction, the Ld. AO cannot add the whole sales proceeds as income. The Ld. AO has to compute Capital Gains as per the scheme of the Act.

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