What is short term capital gain tax on shares?

When shares & mutual funds are sold/redeemed within 12 months of their holding, the gain on such sale/redemption is known as Short Term Capital Gain. The provisions relating to tax on Short Term Capital Gain on equity shares & equity oriented mutual funds are covered by Section 111A of The Income Tax Act. As per section 111A of the Income Tax Act Short Term Capital Gain on equity shares & equity oriented mutual funds is chargeable to tax at a concessional rate of 15%. Detailed provisions of the section 111A: Section 111A is applicable when there is Short Term Capital Gain on sale/redemption of Equity Shares & Equity Oriented Mutual Funds. Here clear emphasis is on Equity Shares & Equity Oriented Mutual Funds. Other Mutual funds like debt funds, Gilt funds, FMPs etc. are not covered by this section.