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Innovations in Biotechnology and Medical Sciences

Surprising ‘Dark Oxygen’ discovery could ensnarl deep-sea mining    

Note4Students

From UPSC perspective, the following things are important :

Prelims level: About Dark Oxygen

Mains level: Impact of Deep-Sea Mining

Why in the News?

Scientists reported on July 22 in Nature Geoscience that an unknown process is generating oxygen in the deep oceans, where photosynthesis is not possible due to the lack of light.

About the recent study:

  • Discovery of Oxygen: Scientists reported an unknown process producing oxygen in the deep ocean, specifically in the abyssal zone, where photosynthesis is not feasible due to insufficient sunlight.
  • Location of Study: The study was conducted in the Clarion-Clipperton Zone, located off Mexico’s west coast, which is known for having the highest concentration of polymetallic nodules.
  • Oxygen Measurement: At a depth of 4 km, researchers observed unexpected increases in oxygen levels, sometimes tripling within two days, contrary to expectations of decreasing levels due to consumption by marine life.
  • Source of Oxygen: The researchers hypothesized that the oxygen could be generated by polymetallic nodules, which may create electric charges that split water molecules, releasing oxygen. The nodules exhibited voltages up to 0.95 V, suggesting they could function like battery cells.

What is Deep-Sea Mining?

  • Deep-Sea Mining: It involves extracting minerals from the ocean floor at great depths, targeting resources such as polymetallic nodules, polymetallic sulphides, and cobalt-rich ferromanganese crusts.

Economic and Strategic Importance of Deep-sea Mining:

  • Resource Potential: The Clarion-Clipperton Zone holds substantial reserves, including 6 billion tonnes of manganese, and over 200 million tonnes each of copper and nickel, making it a significant target for future mining operations.
  • International Contracts: The International Seabed Authority has granted exploration contracts to various contractors, including the Government of India, for deep-sea mining activities.

What is Dark Oxygen?

  • “Dark oxygen” refers to the oxygen found in the deep ocean, specifically in regions where photosynthesis cannot occur due to the absence of sunlight. In such areas, known as the abyssal zone, oxygen levels are typically low and depend on global ocean circulation for replenishment.

Impact of Deep-Sea Mining

  • Ecological Concerns:
    • Potential Damage: The recent findings highlight the potential risks of deep-sea mining to unique marine ecosystems that depend on ‘dark oxygen’. There is concern that mining could disrupt these ecosystems, leading to significant and possibly irreversible environmental impacts.
    • Historical Evidence: Previous experiments, such as the DISCOL Experiment, have shown long-term ecological damage from simulated mining activities, including reduced biodiversity and altered sedimentological profiles.
  • Industry Response and Challenges:
    • Insurance Withdrawal: In response to growing concerns, major European insurance companies announced they would exclude deep-sea mining from their underwriting portfolios.
    • Sustainability Issues: The new discovery of ‘dark oxygen’ adds complexity to the debate on deep-sea mining. If sustainable practices are not implemented, such mining could become unfeasible due to its potential negative impacts on marine ecosystems.

Way forward: 

  • Develop Comprehensive Environmental Regulations: The Government should establish and enforce robust environmental regulations and impact assessment protocols for deep-sea mining.
  • Promote Sustainable Mining Practices: Need to invest in research and innovation to develop and implement technologies and methods that minimize environmental impact.

Mains PYQ: 

Q Coastal sand mining, whether legal or illegal, poses one of the biggest threats to our environment. Analyse the impact of sand mining along the Indian coasts, citing specific examples. (2019)

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Climate Change Negotiations – UNFCCC, COP, Other Conventions and Protocols

What is South Africa’s new law on climate change?   

Note4Students

From UPSC perspective, the following things are important :

Prelims level: About Paris Climate Agreement

Mains level: Initiatives against climate change by the Indian government

Why in the news?

President Cyril Ramaphosa signed a law imposing mandatory emission curbs on large industries and requiring climate adaptation plans to meet South Africa’s Paris Agreement commitments.

Features of the Law:

  • Mandatory Emission Curbs: The legislation imposes mandatory limits on emissions from large, fossil-fuel-heavy industries.
  • Climate-Adaptation Plans: It requires towns and villages to develop and implement climate-adaptation plans.
  • Emissions Reduction Commitments: The law aims to help South Africa meet its emissions reduction commitments under the Paris Agreement.

Significance of this law: 

  • Data-Driven Approach: The law is based on emissions data and trends, such as the decrease from 512 Mt CO2e in 2017 to 405 Mt CO2e in 2022 will help in sustained efforts in emission reduction.
  • Reduction in Emissions: The law aims to significantly reduce South Africa’s greenhouse gas emissions, aligning with the Paris Agreement. This is a crucial step for South Africa’s status as one of the top 15 GHG emitters globally.
  • Transition from Coal: South Africa relies heavily on coal for electricity generation. The bill’s mandatory curbs on emissions from large, fossil-fuel-heavy industries are a critical step towards reducing dependence on coal and shifting towards cleaner energy sources.

Does India have an omnibus legislation on climate change?

  • No Comprehensive Legislation: India does not have a comprehensive, omnibus legislation specifically addressing climate change.
  • Climate Change in Existing Acts: Climate change is addressed within multiple existing Acts and subordinate legislation, such as the Environmental Protection Act, Forest Conservation Act, Energy Conservation Act, and Water (Prevention and Control of Pollution) Act.
  • Private Member’s Bill: A Private Member’s Bill called the Council on Climate Change Bill was proposed by Rajya Sabha parliamentarian Priyanka Chaturvedi in 2022, which aimed to establish a Council to advise the Union government on climate change matters, but there has been no significant progress on this bill.
  • Supreme Court Ruling: The Supreme Court recognized the “right against the adverse effects of climate change” and highlighted the need for comprehensive climate change legislation, linking the impact of climate change to citizens’ rights of liberty, life, and equality.

Way forward: 

  • Comprehensive Legislation and Institutional Framework: India should work towards enacting comprehensive climate change legislation that integrates and harmonizes existing laws related to environmental protection, energy conservation, and pollution control.
  • Enhanced Research and Implementation Support: Need to invest in extensive scientific research to evaluate the efficacy and potential impacts of transitioning to low-carbon and renewable energy sources.

Mains PYQ: 

Q Climate change is a global problem. How India will be affected by climate change? How Himalayan and coastal states of India will be affected by climate change? (2017)

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Organic Farming – Paramparagat Krishi Vikas Yojna (PKVY), NPOF etc.

Should India focus on natural farming?    

Note4Students

From UPSC perspective, the following things are important :

Prelims level: About National Mission on Natural Farming (NMNF)

Mains level: Concerns related to Natural Farming

Why in the news?

In the 2024-25 Budget proposals, Union Finance Minister Nirmala Sitharaman declared that over the next two years, one crore farmers nationwide will be introduced to natural farming, with support provided through certification and branding.

National Mission on Natural Farming (NMNF):

  • The National Mission on Natural Farming (NMNF) aims to encourage farmers to adopt chemical-free farming practices and willingly shift to natural farming based on the merits of the system.
  • The government believes the success of NMNF hinges on changing farmers’ behaviour to transition from chemical-based inputs to cow-based, locally-produced inputs, supported by a financial outlay of ₹4,645.69 crore over six years (2019-20 to 2024-25) under the ‘Bharatiya Prakritik Krishi Paddhati’ scheme.

What is natural farming?

  • Natural farming avoids the use of chemical fertilizers and pesticides, instead promoting traditional indigenous practices. 
  • It focuses on recycling on-farm biomass, employing biomass mulching, and utilizing formulations made from cow dung and urine.
  • Pests are managed through diverse farming practices and on-farm botanical mixtures, strictly excluding all synthetic chemical inputs.

What are the concerns related to Yield?

  • Yield Reduction: Agricultural experts are concerned that a large-scale transition to natural farming could result in reduced crop yields. Studies have shown significant declines in yield for staples like wheat (59%) and basmati rice (32%) compared to integrated crop management systems.
  • Food Security: Lower yields from natural farming could threaten food security in a populous country like India, potentially only being able to feed around one-third of the population with staples like wheat and rice.

Findings on the Ground:

  • Mixed outcomes: Field experiments have shown mixed results. Some studies indicate improved yields and incomes with lower costs due to biological inputs, while others show a decline in productivity.
  • Good Results in Andra Pradesh: In Andhra Pradesh, adopting natural farming methods has shown promising results, leading to better crop yields and enhanced farmers’ incomes.
  • Concerns about sustainability and productivity: Agro-scientists from the Indian Council of Agricultural Research (ICAR) and the Indian Institute of Farming Systems Research (IIFSR) have raised concerns about the sustainability and productivity of natural farming methods.

Differences in Studies:

  • CESS Study: The Centre for Economic and Social Studies (CESS) and Institute for Development Studies Andhra Pradesh found that natural farming practices led to improved yields and incomes for farmers, thereby enhancing food and nutritional security.
  • ICAR-IIFSR Study: The study by ICAR-IIFSR reported a significant decline in yields of key crops like wheat and basmati rice when compared to conventional farming practices, suggesting a negative impact on food supply.

Case study of Sri Lanka:

  • Policy Shift: Sri Lanka’s decision to completely switch to organic farming and ban chemical fertilizers led to economic and political turmoil.
  • Yield Decline: Farmers struggled to obtain natural fertilizers, resulting in reduced yields of key crops, including rice.
  • Food Security Risk: The shift put the country’s food security at risk, causing sharp price escalations and widespread protests and unrest.

Way forward: 

  • Localized Implementation and Scientific Validation: Need to conduct rigorous scientific studies and extensive field trials to validate the productivity and viability of natural farming methods before scaling them up nationwide.
  • Hybrid Approach and Support for Farmers: Govt. should adopt a hybrid approach that combines the best practices of both natural and conventional farming to ensure food security.  

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Right To Privacy

SC to examine acquitted man’s ‘Right to be Forgotten’: What is this right, and how have courts ruled earlier?    

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Right to be Forgotten

Mains level: Key judgments related to the Right to be forgotten

Why in the News?

Last week, the Supreme Court agreed to hear a case that could define the scope of the “Right to be Forgotten” referred to in European privacy law as the “Right to Erasure” in India.

What is the ‘Right to be Forgotten’?

  • The right to be forgotten allows individuals to remove or de-index their personal information from the internet if it infringes on their right to privacy. It is based on the principle that personal data should be removed when it is outdated, irrelevant, or no longer necessary.
  • Affirmed by the Court of Justice of the European Union (CJEU) in the “Google Spain case” (2014), which ruled that search engines must remove data if it is inadequate, irrelevant, or excessive in light of the time elapsed.
  • Under the EU’s General Data Protection Regulation (GDPR), Article 17 describes the right to erasure, reflecting the concept of informational self-determination.

How is this ‘Right’ interpreted in India?

  • Absence of Statutory Framework: India lacks specific legislation explicitly addressing the right to be forgotten.
  • Judicial Interpretation: The 2017 Supreme Court ruling in Justice K.S. Puttaswamy v. Union of India recognized the right to privacy as a fundamental right. Justice S.K. Kaul’s concurring opinion suggested that the right to be forgotten involves removing personal data that is no longer necessary or relevant.
  • Judicial Guidelines: Justice Kaul outlined valid justifications for overriding this right, including freedom of expression, legal compliance, public interest, and research purposes.

How have Courts ruled on the Issue?

  • Rajagopal vs. State of Tamil Nadu (1994): The Supreme Court recognized a “right to be let alone” but differentiated it from public records, including court decisions. Once something becomes public, privacy rights are diminished.
  • Dharamraj Bhanushankar Dave vs. State of Gujarat (2017): Gujarat HC refused to remove details of an acquittal, asserting that court orders should remain public.
  • The Registrar General (2017): Karnataka HC protected the name of a petitioner in a sensitive annulment case, aligning with trends in Western jurisdictions.
  • Delhi HC (2021): Extended the right to be forgotten to criminal cases, allowing details of an acquittal to be removed from search results to protect the petitioner’s career prospects.
  • Orissa HC (2020): Noted the need for a broader debate on the right to be forgotten, particularly concerning “revenge porn” and online content.

Way forward: 

  • Legislative Framework Development: India should consider drafting comprehensive legislation that explicitly addresses the right to be forgotten, aligning with international standards while balancing privacy, freedom of expression, and public interest.
  • Judicial and Policy Clarity: The Supreme Court’s upcoming ruling should aim to establish a clear legal precedent on the right to be forgotten, ensuring consistency across lower courts and aligning with global practices.

Mains PYQ: 

Q Examine the scope of Fundamental Rights in the light of the latest judgement of the Supreme Court on the Right to Privacy. (2017)

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Forest Conservation Efforts – NFP, Western Ghats, etc.

CITES eases Export of Agarwood from India

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Agarwood

Why in the News?

  • India successfully prevented the inclusion of Aquilaria malaccensis (agarwood) in the Review of Significant Trade (RST) of the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES).
    • CITES notified a new export quota for Aquilaria malaccensis from India, effective April 2024.

What is Agarwood?

  • Agarwood (the Wood of Gods) also known as “Oud,” is a highly valuable and aromatic resinous wood produced by the Aquilaria tree.
  • The resin forms in the heartwood of the tree when it becomes infected with a particular type of mold (Phialophora parasitica).
  • This infection causes the tree to produce a dark, fragrant resin, which is highly sought after for its distinctive aroma.
  • This contains essential oils with compounds like sesquiterpenes, chromones, and phenylethyl chromone derivatives.
  • It thrives in tropical forests, at altitudes up to 1000 meters, often found in areas with high humidity and rainfall.
  • Conservation Status:
    • IUCN Status: Listed as Critically Endangered.
    • CITES: Listed in Appendix II in 1995 based on India’s proposal at CoP9 in 1994.

Uses of Agarwood

  • It is traditionally used as incense.
  • Extracts (agarwood oil) are used in perfumes, the aroma industry, medicine, air fresheners, and purifiers.
  • Essential oil has anti-inflammatory, anti-rheumatic, analgesic, and anti-oxidant properties.
    • Agarwood cultivation is prevalent in parts of India, especially in the Northeast.
    • This development will benefit lakhs of farmers in districts of Assam, Manipur, Nagaland, and Tripura.

What is the issue over the inclusion of ‘Agarwood’ (Aquilaria malaccensis) in the RST of the CITES list?

  • Aquilaria malaccensis was listed in Appendix II of CITES in 1995, which means its trade is controlled to avoid utilization incompatible with its survival.
  • The RST process assesses whether trade in a species is detrimental to its survival and recommends actions to ensure sustainability.
  • India’s stance was supported by a study conducted by the Botanical Survey of India (BSI), which suggested that the harvest from wild populations should be prohibited, while allowing harvest from plantations and private/community lands.

Arguments against Inclusion in RST

  • Controlled Harvesting: India argued that it has established controlled harvesting practices, ensuring that only cultivated agarwood is used for trade.
  • Economic Impact: Inclusion in the RST could have disrupted the livelihoods of farmers and traders who depend on agarwood cultivation, particularly in the northeastern states of Assam, Manipur, Nagaland, and Tripura.
  • Sustainable Practices: The NDF indicated that the current practices in India were sustainable and that the species was being cultivated widely, reducing pressure on wild populations.

New Export Quota

  • Establishment of Quota: CITES notified a new export quota for agarwood from India, effective from April 2024. The quota was set at 1,51,080 kg/year for agarwood chips and powder/sawdust, and 7,050 kg/year for agarwood oil.
  • Formal Trade: The absence of an export quota for a long period had led to informal trade and increased prices. The new quota aims to regulate and legalize the trade, ensuring benefits to local growers and the economy.
[2016] With reference to ‘Red Sanders’, sometimes seen in the news, consider the following statements:

1. It is a tree species found in a part of South India.

2. It is one of the most important trees in the tropical rainforest areas of South India.

Which of the statements given above is /are correct?

(a) 1 only

(b) 2 only

(c) Both 1 and 2

(d) Neither 1 nor 2

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Climate Change Impact on India and World – International Reports, Key Observations, etc.

Himachal witnesses gradual snowfall pattern shift  

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Shift in snowfall patterns in Himachal, Rivers and glaciers located

Why in the News?

  • Himachal Pradesh is experiencing a reducing snow cover over the years.
    • There is a noticeable shift in snowfall occurrence from winter months towards early summer months.

Findings from the Latest Study:

  • The study by the Centre on Climate Change of Himachal Pradesh Council for Science Technology-Environment (HIMCOSTE) shows an overall decrease of 12.72% in snow cover area in 2023-24 compared to 2022-23.
  • The study used Advanced Wide Field Sensor (AWiFS) satellite data to analyze snow cover trends.
  • Early winter months (October-November) showed a decrease in snow cover area except for the Ravi basin, which showed a marginal increase in October.
  • Peak winter months (December-January) saw a negative trend in snow cover area.
  • Late winter months (February-March) showed a positive trend with an increase in snow cover area in all basins compared to the previous year.
  • Snow cover area increased in April due to fresh snowfall in the early summer period.

Impact on Water Availability

  • The decrease in snow cover during peak winter months (December and January) is especially alarming.
  • Snowfall during these months sustains longer and enhances the discharge dependability of major river basins during summer.
  • Reduced snow cover in winter could affect water availability during the summer months.

Concerns and Implications

  • Environmentalists and scientists are concerned about the shifting snowfall patterns.
  • Depleting snow cover and changing snowfall patterns have significant impacts on hydro-power, water sources, people, livestock, forests, farms, and infrastructure.

Back2Basics: Rivers of Himachal Pradesh   

Description
Satluj
  • Originating from Rakas Lake in Tibet, the Satluj River is the longest river in Himachal Pradesh.
  • It flows through the districts of Kinnaur, Shimla, Kullu, Mandi, Solan, and Bilaspur, and enters Punjab near Nangal.
  • The river is crucial for hydropower generation and irrigation.
  • Hydropower Dams: Bhakra Dam (Bhakra-Nangal Project), Nathpa Jhakri Dam, Karcham Wangtoo Dam.
  • Glaciers Feeding: Rakas Lake (Tibet), Zema Glacier, Shipki La Glacier.
Beas
  • The Beas River originates from Beas Kund near Rohtang Pass.
  • It flows through the districts of Kullu, Mandi, Hamirpur, and Kangra, eventually entering Punjab.
  • It is known for its picturesque valleys and is significant for agriculture and hydropower.
  • Hydropower Dams: Pandoh Dam, Pong Dam (Maharana Pratap Sagar).
  • Glaciers Feeding: Beas Kund Glacier.
Ravi
  • Originating from the Bara Bhangal Glacier in the Himalayas, the Ravi River flows through the Chamba district of Himachal Pradesh.
  • It eventually enters Pakistan. The river is crucial for both hydropower and irrigation in the region.
  • Hydropower Dams: Chamera Dam (Chamera I, II, and III).
  • Glaciers Feeding: Bara Bhangal Glacier.
Chenab
  • The Chenab River, formed by the confluence of the Chandra and Bhaga rivers, originates from the Bara Lacha Pass in Lahaul-Spiti.
  • It flows through the districts of Lahaul and Chamba before entering Jammu and Kashmir.
  • It is one of the largest rivers in terms of discharge and is vital for hydropower.
  • Hydropower Dams: No major dams within Himachal Pradesh, but significant potential for hydropower.
  • Glaciers Feeding: Bara Shigri Glacier, Miyar Glacier.
Yamuna
  • The Yamuna River originates from the Yamunotri Glacier in the Garhwal Himalayas.
  • It forms the eastern boundary of Himachal Pradesh with Uttarakhand.
  • It is one of the most sacred rivers in India and supports major irrigation systems downstream.
  • Hydropower Dams: No significant major hydropower projects within Himachal Pradesh (major dams located downstream in Uttarakhand and Uttar Pradesh).
  • Glaciers Feeding: Yamunotri Glacier.
Spiti
  • The Spiti River originates from the Kunzum Range and flows through the cold desert region of Spiti Valley in Himachal Pradesh.
  • It joins the Satluj River near Khab. The river is known for its stunning landscapes and unique ecosystem.
  • Hydropower Dams: No significant major hydropower projects (projects primarily focused on other rivers in the region).
  • Glaciers Feeding: Kunzum Range Glaciers.
Parbati
  • The Parbati River originates from the Parbati Glacier in the Kullu district.
  • It is a tributary of the Beas River.
  • The river is significant for its hydropower potential and scenic beauty, attracting many trekkers and nature enthusiasts.
  • Hydropower Dams: Parbati Hydroelectric Project.
  • Glaciers Feeding: Parbati Glacier.

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President appoints six new Governors  

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Appointment of Governors

Why in the News?

President Droupadi Murmu has appointed six new Governors and reshuffled three others.

New appointments:

Name New Position
Om Mathur Governor of Sikkim
K. Kailashnathan Lieutenant Governor of Puducherry
Santosh Kumar Gangwar Governor of Jharkhand
Jishnu Dev Varma Governor of Telangana
Ramen Deka Governor of Chhattisgarh
C.H. Vijayashankar Governor of Meghalaya
Haribhau Kisanrao Bagde Governor of Rajasthan

About the Office of Governor and his/her Appointment

Details
Role
  • Constitutional head of a state, similar to the President at the central level.
  • Exists in states, while lieutenant governors and administrators are in union territories.
  • Independent constitutional office, not subordinate to Central government.
Articles Articles 153 to 167 in Part VI of the Constitution deal with the state executive
Part of State Executive Consists of the Governor, Chief Minister, Council of Ministers, and Advocate General
Borrowed Office
  • From the Government of India Act of 1935.
  • Canadian model adopted: Governor appointed by President by warrant under his hand and seal.
Dual Role
  • Chief executive Head of the States (nominal).
  • Agent of the central government.
Qualifications
  • Constitutional: Citizen of India, 35+ years old.
  • Conventional: Outsider to the state, President consults the Chief Minister.
Oath
  • Administered by the Chief Justice of the state High Court (or senior-most judge available)
  • Swears to execute office faithfully, preserve the Constitution, and serve the people
Term of Office
  • No fixed term, holds office for 5 years subject to President’s pleasure
  • Eligible for reappointment.
  • Can be transferred or hold office beyond term until successor assumes charge
Removal
  • Can resign by addressing the President
  • Can be removed by the President at any time without specified grounds
  • Chief Justice of state high court may temporarily discharge functions in contingencies
Additional Functions
  • Acts on advice of Chief Minister and Council of Ministers
  • Holds executive power, legislative power (to some extent), and discretionary power
  • Functions as Chancellor of state universities, where applicable
Reforms  stipulated by Sarkaria Commission (1988)
  • Governor should be appointed by the President after consulting the Chief Minister.
  • Should be a person of eminence, not belonging to the state.
  • Should not be removed before term completion except in rare circumstances.
  • Act as a bridge between the center and state.
  • Exercise discretionary powers judiciously.

 

PYQ:

[2013] Which one of the following statements is correct?

(a) In India, the same person cannot be appointed as Governor for two or more States at the same time

(b) The Judges of the High Court in India are appointed by the Governor of the State just as the Judges of the Supreme Court are appointed by the President

(c) No procedure has been laid down in the Constitution of India for the removal of a Governor from his/her post

(d) In the case of a Union Territory having a legislative setup, the Chief Minister is appointed by the Lt. Governor on the basis of majority support.

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Tax Reforms

What is Indexation in calculating LTCG tax?

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Indexation, Capital Gains Tax Regime.

Why in the News?

The withdrawal of the indexation benefit from the long-term capital gains (LTCG) tax regime has emerged as a contentious decision in the Union Budget for 2024-25.

What is Indexation?

  • Indexation is a method used to adjust the purchase price of an asset to account for inflation over the period it was held.
  • This reduces the taxable capital gain, as it reflects the increase in the asset’s value due to inflation.
  • Purpose: To ensure that the taxpayers are taxed only on the real gains and not on the inflationary increase in the value of the asset.

Changes in the LTCG Regime

  • The new LTCG regime removes the indexation benefit for property, gold, and other unlisted assets.
  • The LTCG tax rate is reduced from 20% to 12.5%.
  • For assets purchased before 2001, the fair market value as of April 1, 2001, is considered the cost of acquisition.

Implications of the Changes

  • The government claims the changes simplify the capital gains tax structure without causing a loss to most taxpayers.
  • The uniform tax rate for various asset classes is intended to benefit both taxpayers and tax authorities.

Concerns for Taxpayers

  • There was significant concern, particularly in the residential real estate sector, about increased LTCG tax liabilities.
  • The government clarified that the new regime would be beneficial in most cases, as real estate returns typically outpace inflation.
  • The Income Tax Department explained that:
  1. For properties held for 5 years, the new regime is beneficial if the value has appreciated 1.7 times or more, and
  2. For 10 years, if the value has increased to 2.4 times or more.

Back2Basics: Capital Gains Tax Overview

Details
Definition Tax on profit from the sale of a capital asset.
Launch Introduced in 1956, as part of the Income Tax Act, 1961.
Types Short-Term Capital Gains (STCG): Held for ≤36 months (≤12 months for specified assets).

Long-Term Capital Gains (LTCG): Held for >36 months (>12 months for specified assets).

Tax Rates (STCG) With STT: 15%

Without STT: Applicable income tax slab rates.

Tax Rates (LTCG) Listed Equity Shares & Equity-Oriented Funds: 10% on gains >₹1 lakh without indexation.

Other Assets: 20% with indexation (proposed 12.5% without indexation from FY 24-25).

Indexation Adjusts purchase price for inflation using Cost Inflation Index (CII).
Purpose of Indexation To tax only the real gains, accounting for inflation.
Formula (Indexation) Indexed Cost of Acquisition: (Cost of Acquisition × CII of sale year) / CII of purchase year

Indexed Cost of Improvement: (Cost of Improvement × CII of sale year) / CII of improvement year

 

PYQ:

[2012] Under which of the following circumstances may ‘capital gains’ arise?

1. When there is an increase in the sales of a product

2. When there is a natural increase in the value of the property owned

3. When you purchase a painting and there is a growth in its value due to increase in its popularity

Select the correct answer using the codes given below:

(a) 1 only

(b) 2 and 3 only

(c) 2 only

(d) 1, 2 and 3

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