Explanation:

Capital gain is a profit that results from investments into a capital asset, such as stocks, bonds ore real estate, which exceeds the purchase price. It is the difference between a higher selling price and a lower purchase price, resulting in a financial gain for the investor. Conversly , a capital loss arises if the proceeds from the sale of a capital assets are less than the purchase price.

Capital gains are not applicable to an inherited property as there is no sale, only a transfer of ownership.

The following do not come under the category of capital asset:

a. Any stock, consumables or raw material, held for the purpose of business or profession

b. Personal goods such as clothes and furniture held for personal use

c. Agricultural land in rural India

d. 6½% gold bonds (1977) or 7% gold bonds (1980) or national defence gold bonds (1980) issued by the central government

e. Special bearer bonds (1991)

f. Gold deposit bond issued under the gold deposit scheme (1999) or deposit certificates issued under the Gold Monetisation Scheme, 2015