Dear Sir/Madam I seek your help with regards to my following grievance. I am the holder of NCDs of SREI Ltd.The company went into liquidation and as a final settlement I am being paid the NCDs amount as given hereunder.The investment amount was Rs 100000/-,face value was Rs 1000 each NCD ,the issue date was 16/03/2018 and maturity date was 16/03/2023.I shall feel obliged,if you will please suggest me,how to calculate the LONG TERM CAPITAL LOSS for income tax purpose for the financial year 2023-24. DETAILS OF PAYMENT OF NCD NCD REPORT (Secured) NCD Holders DINESH KUMAR Admitted Claim (Rs) 1,15,266.70 SIFL Equity Final (No. of Shares) @ FV : Rs 10/- 0.00 Final OCD Allotment (Rs) 34,000.00 Tranche 1 Cash Payout - Interim Distribution (Rs) 8,481.00 Final SR Allocation (Rs) 7,000.00 Tranche 2 Cash Payout (Rs) 2,334.00 ISIN INE872A07UR3 ------------------Thanking you and waiting for your valuable support. Dinesh Kumar Back of Rani Mahal,Rani Bag colony , Dhampur(up) 12/07/2024

Ans: Assessing Your Non-Convertible Debenture (NCD) Taxation
Let's break down your query regarding the NCD taxation for this year. We'll focus on the values for cost of acquisition, transfer expenses, and sale price.

Understanding Your NCD Transaction
Purchased NCD: Rs 2,00,000
Admitted Value: Rs 2,30,533
Cash Receipt: Rs 21,630
Future SR: Rs 13,000
OCD: Rs 68,000 (redemption uncertain over 8 years)
Cost of Acquisition
The cost of acquisition is the original purchase price of the NCD. For your case, it's Rs 2,00,000.

Transfer Expenses
Typically, transfer expenses include brokerage, commissions, and other related costs incurred during the purchase and sale of the NCD. You haven't mentioned any specific transfer expenses, so we'll assume there are none. If there are any, you should include them here.

Sale Price
The sale price for the purpose of calculating the capital gains or losses includes the cash received, and the future SR received, but excludes the OCD, as its redemption is uncertain and spread over several years.

Cash Receipt: Rs 21,630
Future SR: Rs 13,000
Calculating Long-Term Capital Loss
Cost of Acquisition: Rs 2,00,000

Transfer Expenses: Rs 0 (assumed)

Sale Price: Rs 21,630 (cash received) + Rs 13,000 (future SR) = Rs 34,630

Steps to Calculate
Cost of Acquisition: Rs 2,00,000
Transfer Expenses: Rs 0
Sale Price: Rs 34,630
Long-Term Capital Loss Calculation
Long-Term Capital Loss = Cost of Acquisition - Sale Price - Transfer Expenses

Long-Term Capital Loss = Rs 2,00,000 - Rs 34,630 - Rs 0

Long-Term Capital Loss = Rs 1,65,370

Taxation Insight
Cost of Acquisition: Rs 2,00,000
Transfer Expenses: Rs 0
Sale Price: Rs 34,630
Long-Term Capital Loss: Rs 1,65,370
This loss can be set off against long-term capital gains in the same financial year. If not fully utilized, it can be carried forward for up to eight assessment years to set off against future long-term capital gains.

Final Insights
You should use Rs 2,00,000 as the cost of acquisition. Transfer expenses are zero if there are none. The sale price for this year's tax purposes is Rs 34,630. Thus, your long-term capital loss amounts to Rs 1,65,370.

Best Regards,

K. Ramalingam, MBA, CFP

Chief Financial Planner

www.holisticinvestment.in