Holding period of shares transfer by NDTV’s promoter from self to joint DEMAT A/c reckoned from date of transfer

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Holding period of shares transfer by NDTV’s promoter from self to joint DEMAT A/c reckoned from date of transfer

Radhika Roy vs. DCIT – [2019] 106 taxmann.com 210 (Delhi – Trib.)

Assessee was promoter of NDTV Ltd. She along with her husband had transferred shares of NDTV from their individual demat accounts to their Joint Demat account. She sold said shares and claimed the gain arising from it as long term capital gains considering period of holding of shares as date of acquisition in their individual demat accounts. She also claimed cost of acquisition as cost incurred by her in individual demat accounts.

The Mumbai ITAT held that shares transferred by assessee from joint demat account were short-term capital assets as they were acquired only on 28-12-2007 through joint Demat Account and were sold on 19-6-2008 resulting in short-term capital gain in hands of assessee.

‘Period of holding’ of shares sold from demat account jointly held by assessee along with her husband to be computed on FIFO basis based on date the securities moved into the demat account and not from date of acquisition in Individual demat account . Further, the ‘cost of acquisition’ of those shares to be considered as sold out on the basis of FIFO method of that demat account.

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