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Capital
Gains
Capital
Asset [Section 2(14)]
'Capital
Asset' means property of every kind held by a tax payer including
property held for his business or profession. It includes all corporeal
and tangible properties as well as all kinds of rights in property.
The gains on transfer of assets in relation to which there is no
cost of acquisition like self generated goodwill of a business ;
tenancy rights ; stage carriage permits ; loom hours ; right to
manufacture , produce or process any article or thing are also taxable
as capital gains. However, certain assets are expressly excluded
from the definition of Capital Asset. These are enumerated below
:
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Stock-in-trade, consumable stores and raw material held for purposes
of the assessee's business or profession.
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Personal effects i.e. movable property like wearing apparel, furniture,
motor vehicles etc. held for personal use of the tax payer or
any member of his family dependent on him. However jewellery,
even if it is for personal use, is always to be treated as a of
capital asset.
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Agricultural land in India. However land falling within municipal
limits or boundaries of a cantonment board of an area having population
of 10,000 or more as per the last census are not agricultural
lands and are treated as capital assets . Agricultural lands situated
within 8 kilometers from the municipal limits are also treated
as capital assets if such peripheral area has been notified by
the Central Government for this purpose. (for definition of agricultural
land refer to module 'Tax Terms')
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Certain specified Gold Bonds .
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Special Bearer Bonds, 1991, issued by the Central Government.
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