The tax code hands you a free allowance every year.
Never selling throws it away.
1.25
Lakh of long term equity gains you can book completely tax free every financial year under Section 112A. It resets every April. Unused, it is gone.
Friend has held the same index fund for seven years. Says it like a badge. Never sold a unit. And every April a tax free allowance he is fully entitled to slips past him unused. Seven of them now. On this one line he is not being disciplined. He is leaving money on the table.