Answer

1. F

   Facts

   For land or building bought before 23 July 2024, resident individuals and HUFs can pay the lower of 12.5% without indexation and 20% with indexation. Others pay 12.5% without indexation. The choice is worked out in Schedule CG.

2. P

   Provisions and law

   • Sec 112 (now Sec 197)Other long-term gains at 12.5% without indexation; resident individuals and HUFs may choose 20% with indexation for land or building bought before 23 July 2024
   • Sec 48 (now Sec 72)Capital gain is sale value less cost of acquisition, cost of improvement and transfer expenses
   • Sec 2(42A) (now Sec 2(101))Holding period: 12 months for listed securities and units, 24 months for other assets, to be long term
3. A

   Analysis

   Say the sale price is ₹90 lakh and cost was ₹30 lakh. Without indexation the gain is ₹60 lakh, tax at 12.5% is ₹7.5 lakh; with indexation (cost inflation index 200 for 2012-13 and 376 for 2025-26) the cost rises to about ₹56.4 lakh, giving a ₹33.6 lakh gain and tax at 20% of about ₹6.7 lakh, which is lower here. Under Sec 112 (now Sec 197), you pay the lower figure. Compute both before filing and keep the working.

4. C

   Conclusion

   1. 1Find purchase date, cost and improvement costs with dates.
   2. 2Compute gain with and without indexation.
   3. 3Compare 12.5% and 20% tax.
   4. 4Report the chosen computation in Schedule CG.

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