CA (Chartered Accountants) Interview Question:

Explain the difference between short term capital asset and long term capital asset?

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Short term capital assets are those assets which are held by an assessee for not more than 36 months, immediately prior to its date of transfer. But in the following cases an asset help for not more than 12 months is treated as short term capital asset:
★ Equity or Preference shared in a company.
★ Securities listed in a recognized stock exchange in Country.
★ Units of UTI
★ Units of a mutual fund specified under sec 10(23D)
Long term capital assets are those assets which are held by an assessee for more than 36 months.
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