Yes, NCDs are subject to Short Term Capital Gain and Long Term Capital Gain taxes.The interest earned from a NCD is included in the 'Income from other sources' of the investor and taxed as per his tax slab.
If the NCDs are sold on the stock exchange, capital gain taxes are applicable as follows-
For NCDs, sold with in a period of 12 months from the date of allotment, short term capital gain taxes are applicable at normal tax slab rates.
For NCDs, sold after a period of 12 months from the date of allotment, long term capital gain taxes are applicable at the rate of 10% without indexation or 20% with indexation whichever is lower.