YOUR QUERIES: INCOME TAX: Long-term capital loss on NCD can be set off against long-term capital gain

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By Chirag Nangia

I used to be a retail investor in mounted deposit and NCD of a NBFC whose debt decision course of concluded lately. My FD of Rs 3 lakh was made in July 2017 for 48 months however I acquired solely Rs 73,000 in Sept 2021. I additionally had been allotted NCDs of Rs 3.28 lakh of their IPO in August 2016 whose maturity was due in August 2019 and I acquired Rs 1.6 lakh in September 2021. Can I declare long-term capital loss?
—Hardeo Singh
Capital acquire or loss can solely come up when there’s a ‘switch’ of capital asset. Fastened deposits made with an NBFC can’t be transferred for a consideration. There aren’t any provisions beneath the Revenue Tax Act for claiming lack of deposits in case of insolvency of a non-banking finance firm. The quantity of loss suffered by you on deposits should not be claimed as a deduction and needs to be construed as useless loss. Additional, because the listed NCDs had been held by you for a interval exceeding one 12 months, the loss in respect of NCDs will likely be deemed to be “long-term capital loss”. Such loss could be set-off towards long-term capital positive factors. Unadjusted loss, if any, could be carried ahead to the next eight evaluation years.

Is availing a house mortgage to avoid wasting tax a sound choice? I exhaust all the pieces beneath 80C and make investments beneath NPS.
—Hitesh Bathija
A deduction as much as `1.5 lakh is permitted beneath part 80C on account of principal reimbursement of residence mortgage taken for buy/ building of home property. As well as, taxpayers can declare deduction in respect of curiosity borrowed for acquisition, building, restore or reconstruction of a home property from the earnings computed beneath the top “home property”. In case of let-out property, there isn’t any financial cap on quantity of deception.

Deduction of curiosity in respect of self-occupied home property is as much as Rs 2 lakh, which is decreased to Rs 30,000 if building just isn’t accomplished inside a interval of 5 years. In addition to, you’ll be able to declare deduction of curiosity for pre-construction interval in 5 consecutive instalments, from the 12 months through which the property is acquired or constructed. Though you might not have the ability to declare deduction in respect of principal reimbursement of residence mortgage on account of exhaustion of prescribed restrict, you should still get benefitted by claiming deduction of curiosity factor.

The author is director, Nangia Andersen India. Ship your queries to fepersonalfinance@expressindia.com