Section 45(2) of the Income Tax Act cover a case of conversion of investments to stock-in-trade. But , there is no provision to cover a case of reverse conversion i.e conversion of stock-in-trade to investment. Now , the taxation of gains on transfer of capital asset is dependent on the nature of transfer of asset . That is whether the gain is Short Term or Long Term. This nature of asset is found out by counting the period of holding of capital asset . In case of conversion of stock-in-trade to investment , the first issue to grapple with is computation of period of holding. This post is going to restrict itself to answer the question regarding determination of period of holding in case stock-in-trade is converted to capital asset.