Bonds / Government Securities / Debt Listed on Indian Exchanges / Unlisted have different Tax Treatment.
Listed Bonds sold on exchange don't get indexation benefit. They are taxed like equity, so if held above 12 months 10% tax on the Profit (cost price - sale price).
Unlisted Bonds LTCG period is 3 years. And taxation of LTCG is 20% with indexation and 10% without indexation.
Yearly Interest received in your hands is already taxed as per your normal slab rates.
