New Delhi, April 28 -- From the facts provided, we understand that as per the joint holding policy of the fund (anyone or survivor), units of the ELSS fund would be transmitted to or inherited by the surviving account holder. Also, the lock-in period of three years is not applicable for the survivor. As per the provisions of the Income-tax Act, inheritance does not qualify as 'transfer' and hence, no capital gains would arise at the time of transmission of the MF units.

As and when such units are further sold (subject to any specified lock-in provisions of the fund), the survivor would need to pay capital gains. Any gain or loss arising from sale of ELSS funds held for a period of more than 12 months prior to their sale is considered as ...