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I held Mindtree shares for over 10 years. These got converted to LTIMindtree after the takeover and merger with LT Infotech. This corporate action took place after 31.01.2018.
Since LTIMindtree shares were not listed on 31.01.2018, how can I get grandfathering benefit of LTCG when I sell the LTIMindtree shares?
V Vijaykumar
The transaction of allotment of shares in the amalgamated company post-merger is not regarded as a transfer as per Section 47(vii) of the Income-Tax Act, 1961 (‘the Act’). Further, as per Section 49(2) of the Act, the cost of acquisition and purchase date for such shares shall be considered as same of the share of the amalgamating company i.e. Mindtree in your case.
Thus, you would be eligible to get the grandfathering benefit on sale of such shares held by you in LTI Mindtree. You may note that grandfathering would be based on the FMV of the Mindtree shares held by you earlier.
I have taken a joint home loan with my wife and the annual interest payment is ₹5.2 lakh. My wife and I take ₹2 lakh each as allowed for interest deduction for taxes. Is there any way to take full benefit as the remaining ₹1.2 lakh seems to be going waste without any tax advantage?
Avudaiappan
I understand that the said property for which you have taken a joint loan is jointly owned and self-occupied property. Further, it is assumed that both you and your wife are paying the loan from your individual source of income. The maximum interest deduction that can be claimed for the said house property, as per the second proviso to Section 24(b) of the Income-Tax Act, 1961(the Act), is ₹2 lakh, i.e. you and your spouse can claim the maximum interest deduction of ₹2 lakh each. Therefore, there is no recourse to claim the interest deduction of remaining ₹1.2 lakh in such case.
However, in case the said property is rented, and the rent received from the same is offered to tax in your tax return, the complete interest deduction of ₹5.2 lakh can be claimed.
The author is a practising chartered accountant
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