Skip to content

CA Intermediate · Taxation · Capital Gains

Deepa, a resident individual, was allotted 1,000 bonus shares of a listed company in tax year 2026-27. Eight months after the allotment she sold all of them on a recognised stock exchange (STT paid) at ₹150 per share. She paid brokerage of ₹2,000. The market value of the shares on the allotment date was ₹100 per share. What is her short-term capital gain?

The short-term capital gain is ₹1,48,000. Bonus shares have nil cost of acquisition and are held from the allotment date, so eight months makes them short-term. The sale value of ₹1,50,000 less brokerage of ₹2,000 gives the gain.

  1. A₹1,48,000Correct
  2. B₹1,50,000
  3. C₹48,000
  4. DNil

Explanation

The cost of acquisition of bonus shares allotted without payment is nil, and the holding period runs from the date of allotment. Eight months is less than 12 months, so the shares are short-term. Gain = 1,50,000 - 2,000 - nil = ₹1,48,000. Taking ₹100 per share as cost gives ₹48,000, which is wrong because market value at allotment is not the cost for bonus shares.

Did you get it right without looking?

One question tells you little. A timed set on Capital Gains shows your real accuracy, how long you take and where you lose marks.

Practise Capital GainsFree diagnostic mock

More Capital Gains questions