Yes friends, welcome to a new episode of Dhaara Bhai in
which we were discussing the tax on long term capital gain
that at what rate tax is imposed on our long term capital
assets I had divided it into two categories one is the
share market that you earn which we had named as 112A what
did it say? it used to shout that 10% tax will be imposed
if your long term capital gain is more than Rs.
1 lakh let's move to the second category others category
others is simple there are two things in it either you are
buying shares but not listed shares but unlisted shares if
you buy unlisted shares then two rates work one of 10% and
one of 20% and the rest if you have a land and building or
you have sold a property then 20% rate works sir, what is
this? let me explain first tell me, I have used a new ink
is it clear? or should I change it? should I change it a
little?
I generally use red ink so that you can see it let me use
red ink you have unlisted shares of any private company you
have unlisted shares of any private company you have
unlisted shares of any private company like private company
shadi.com shadi.com is a private company it's shares are
not sold in the market it's shares are not sold in the
market it's shares are not sold in the market it's shares
are not sold in the market so I bought shares of shadi.com
from anupam mittal 10% share 15% share
I bought a share of 10% for 100 crores ok yesterday there
was a fight between them he said who is that?
Ashneel Grover
Ashneel Grover came and said you can't do it you are a
two-faced man you can't do business
I will do business
I will show you how to do business ok he said something
like this and I sold that 10% share to him to Ashneel
Grover for 100 crores
I bought it for 100 crores and sold it to him for 500
crores what will happen to me? capital gain let's say I
hold it for 3-4 years it becomes my long term capital gain
it's an unlisted company it's an unlisted company so at
what rate will it be taxable? 10% rate without indexation
if I don't index my cost without indexation and 20% with
indexation if I do indexation it will be taxable with
indexation what does this mean? what does this mean? why
this discrimination? why are you discriminating?
what are you doing? are you acting like a hero? ok, I am
not acting like a hero let me tell you about discrimination
you break my heart what is the benefit of indexation? what
is the benefit of indexation? let's say my sales
consideration is of 100 crores or let's say
I sold Ashneer Grover for 500 crores what will be my 500
crores? sale consideration if I didn't do indexation what
would be my actual cost? 100 crores capital gain would be
of 400 crores tax would also be of 400 crores is this point
clear? now what am I doing?
I am doing index if I had bought that share today what
would be the value? sale consideration fixed at 500 crores
fix that now by indexing my 100 crores value has become 150
crores now what is the capital gain? 350 crores earlier it
was 400 crores here 350 crores, there 400 crores sir, the
government says that you have done a little trick and
reduced your capital gain by 50 crores you are a very smart
person you have reduced your capital gain by 50 crores how
can they leave you like this?
you have taken the benefit of indexation ok so the tax rate
should also be higher on you and that poor man who didn't
take the benefit of indexation who is showing the actual
cost whose capital gain is of 400 crores because he is a
decent person he didn't increase his cost in his case the
rate of 10% will keep on going this is the point 112a was
covered in the last lecture it was clear in this case there
were two points you sell unlisted shares you sell shares of
shahdeer.com 10% and 20% 20%
is land and building jewellery you hold it for long term
for 3 years in that case take indexation you will get 20%
you are getting the benefit of indexation by the government
which makes you eligible to increase your cost of
acquisition a little so that your capital gain reduces
what have we done till now we are discussing about we are
discussing the capital gain short term capital gain and
long term capital gain their income tax rates in this we
have changed the share market rate to 15% and the other is
normal in this we told there were two categories one was
share market in that case it was 10% and in the other case
if the share market was selling unlisted shares 10% or 20%
and in the other case 20% this is clear take a photo and
save it in your mobile this is very
in life you should know these rates if someone asks you if
someone asks you you should know these rates am I clear or
am I clear are you getting me everything I am getting you
I want to say one thing
I want to say be a little late but be successful and
capable be a little late it will work but be successful and
capable because people with time ask for status
no one is interested in your status except your parents
every person is interested in your status if someone can
get a job they will befriend you if someone can get a job
they will stop attending your calls we have seen this be
capable to show those people their status who never trusted
you
you are having a good time if you are struggling people are
looking at you remember those faces when you become
successful kick them be successful and capable don't be
suppressed by anyone these were some points let's have a
reading some common points if I want to discuss common
points will you allow me to discuss sir you can kill
yourself do you allow small things you think I am a slag
common points are 111A income 111A or 112 from this income
deductions do you remember deductions LIC premium
fees from this income you can't deduct government has
reduced taxes rate 10% 15% due to this
I give deductions but in this case tax rate is low so there
is no requirement to give deductions government says don't
take deductions from this income don't take deductions from
share market income you have to take deductions other than
this salary, house property income business income other
source income but these 2-3 sections from 2-3 lectures
don't try to take deductions from these it is better one
more thing this 112 it was 112 in 112 also exemption limit
point will be covered if
limit is left minus from long term capital gain and put
your percentage on it these are some common points these
are some common points these are some common points these
are some common points
This is a special point. This is the last point and reading
is going on.
This is the last chapter.
There is one more common point. There is a new point.
The new point is that he talks about long term capital gain.
And that too which share market.
If it is a share market then it is 112A.
He says that simple, what do we do?
Out of sales, do we do cost of acquisition minus?
Cost of acquisition minus.
So he talks about calculation.
How to do calculation?
Sometimes it happens.
I am telling you a real life example.
You can search it on YouTube or Google.
There was a person.
In 1960 or 1970, he bought 1 lakh shares of MRF company.
1 lakh shares.
At that time it must have been 1 to 1.5 rupees.
He had won a lottery.
So he had bought 1 lakh shares of MRF company.
At that time, the way you buy shares on computer and sell
shares on computer.
That was not a facility.
You used to go.
They used to give you a paper.
This is your paper.
This is your share document.
You have ownership.
This was the proof of your shareholding.
Now that paper.
That person kept that paper in his cupboard.
He himself forgot.
Because nowadays people do trading.
At that time, it was not that much.
In 1965 or 1970, what must have happened?
He also forgot.
It was 1970.
In 1975, 80, 85, 90 came.
That paper got lost somewhere.
It must have come inside a cloth.
It must have gone somewhere.
It must have gone inside a book.
I don't know where that paper went.
There was only one paper.
It was written on it, 1 lakh shares of MRF company.
Okay sir, no problem.
1 lakh shares.
That person's child turned out to be useless.
In old age, he had the same condition.
Which happened in Rajesh Khanna's Avatar movie.
And in Baghban movie, Amitabh Bachchan's condition.
His child insulted him in his old age.
And instead of serving him, he threw him out of his house.
But his grandson was very good.
That grandson used to say,
Grandpa, I will die but I won't let you drown like this.
He used to say,
The one who drowns, can't be killed by anyone.
So that grandson started living with his grandfather.
They made a small hut somewhere.
And started living there.
And whatever was available, they kept it in that hut.
That poor grandson used to work somewhere.
And used to serve his grandfather.
I am telling you the actual case.
Sir, in 2020, 2018 or 2020, this is the same time.
His grandfather passed away.
It was very bad.
May God give peace to his soul.
His grandfather passed away.
Sir, his grandfather passed away.
But most of the time, he signed a paper and gave it to me.
Although I don't have anything.
But whatever I have, these clothes,
or these papers, this hut, whatever I am going,
I am going,
I am going to my grandson.
Whatever I have, my property,
I am going to my grandson.
Okay, sir.
He died.
He did his last rites.
After a few days, when he was cleaning, the same paper was
found by that person in which it was written that your
grandfather bought 1 lakh shares of MRF in 1965.
He got that paper.
And he also had another paper in which it was written that
I give all my property to my grandson.
If you read these two papers together, what will you
understand?
Whose share is this 1 lakh?
Grandson's.
Grandson lost his mind and he checked the MRF rate.
Sir, I am telling you the actual rate of that time.
The rate of that time was 90,000 per share.
The rate of one share.
The rate of one share was 90,000.
And multiply it by 1 lakh.
Director sir, please tell me how much did it become?
One share of 90,000 and one lakh share.
How much did it become?
5, 0 and 2, 0 so it became 9 crores.
And how much did it become? 900 crores.
Let me tell you.
See, the calculator is also feeling shy to tell you.
Sir, it became 900 crores.
900 crores.
How much did it become? 900 crores.
The investment of 1965 and today's value of 900 crores.
It is said that the fruit of service is the life of that
plant.
The poor fellow used to do small jobs of 15,000-16,000 and
today he has 900 crores overnight, my dear.
He has got 900 crores in today's rate.
Now what will he do?
What will he do?
He will convert it into a normal Demat account.
He has the shares.
He will sell it and make a living somewhere.
This is the point, sir.
This is the actual story.
The investment of 900 crores.
If tomorrow this person goes to the market to sell the
investment of 900 crores, then first of all, what will be
the case?
Will there be a long-term capital gain?
Should there be a long-term capital gain?
Yes or no?
Sir, the investment of 1965.
The holding period of the previous owner will also be
checked.
Because he got it as a will.
Remember the point of Bobby Deol.
He got it as a will.
So what will happen?
Where will he show his 900 crores?
Sales.
But tell me one thing, because Dada Ji knew how much money
he had taken.
And Dada Ji, what is the cost of acquisition in this case?
This was the point for which I told you the whole story.
You can check the real story on YouTube.
You will get it.
I have already told you,
I don't say anything wrong.
My examples are true.
Lappi Lahiri is a real person.
He is a real person.
We have to calculate the cost of acquisition.
What did the cost of acquisition government say?
They gave a rule for this.
That such cases can happen in real life.
Such cases can be seen.
In that case, what will be the cost of acquisition?
How will it be? How do we calculate?
Come, let's check.
First of all, what do you have to give?
First of all, take the sales consideration.
What is the sales consideration?
Rs. 900 crore.
Or the fair market value, the market value of that share
was Rs.
What was the market value of that share on 31st, 2018?
You are getting to know that.
Assume that on 31st, 2018, the fair market value of that
share, now what does the market value of 31st, 2018 mean?
Sir, it means that on 31st, January, 2018, if you had that
share, or even before that, then the market value of that
rate means that what was the highest trading price on that
day?
Whenever you check a share, the rate, the opening, closing,
previous, today's opening, you will see this point.
So, on that day, on 31st, January, 2018, what was the
highest price of that share?
You have to compare these two.
Assume that on that day, the price of this share was Rs.
100 crore.
Now, what do you have to do between these two? Whichever is
less.
What will be less?
Rs. 100 crore.
What will be less in this case?
Rs. 100 crore.
How do you have to compare this?
You have to compare it with the purchase price.
Rs. 100 crore versus the purchase price.
What was my purchase price?
I will get the purchase price from that paper.
The paper of the will where it was written that
I bought the share for Rs. 1 lakh.
Versus Rs. 1 lakh.
Rs. 100 crore versus Rs. 1 lakh.
Whichever is higher.
Rs. 100 crore or Rs.
1 lakh?
Rs. 100 crore.
So, what will be the cost of acquisition?
Rs. 100 crore.
What do you have to do with this?
When you make sales of Rs.
900 crore, minus the cost of acquisition.
What will be the cost of Rs.
800 crore?
Long term capital gain will be there.
Check it once.
Sir, how were the sounds coming?
Son, I had gone to drink water.
What do you say?
How were the sounds coming?
Okay? Comparison of sales consideration which was 31st
January 2018 fair market value.
But where will you get this fair market value from? You
will be able to get it from the same case.
If you had that share on 31st January 2018 or you were
holding it before that, if on that date you didn't have
that share, then where will you get this value from?
Comparison between Sales Concentration and Fair Market Value
Take the value which is less than both
And then compare it with the actual purchase cost of the
share
The higher the value, the higher will be the value of the
cost of acquisition
Fair market value of 31st January 2018 is the highest
trading price
If listed, it is the highest trading price and if not
listed, it is the net asset value