Commerce World of American Institute of Accountancy in Dibrugarh.

BASIC CONCEPTS.

Gain or Loss on Transfer of capital assets affected during the course of previous year is taxable under this head.

Capital Assets.

Tax is to be levied on any profit or gain occurring on the transfer of a capital asset. Section 2(14) defines capital assets as :

(1) Property of any kind held by an assessee whether or not connected with his business or profession.

(2) Any security held by a Foreign Institutional Investor who has invested in such security in accordance with the regulations made under SEBI Act, 1992 ( w. e. f. A. Y. 2015-16 )

Any asset ( What we own) whether used for business or not, whether tangible or intangible. Assets includes land, building, Plant and Machinery, vehicles, shares, securities, Gold, Silver, jewellery, Goodwill, patent rights or any right in these assets.

Following asset are not capital assets :

(1) Stock-in-trade or other consumable raw material.

(2) All personal effects except jewelery The term personal effect means all movable goods used for personal purposes including household goods, clothes, utensils etc. In case any asset is partly used for business and partly for personal purposes, it will not be capital asset to the extent it is used for personal purposes. Jewelry means anything made of precious metal whether studded with or without precious stones etc.