Advance money received reduces cost of acquisition for capital gains unless already included in income. Advance money received in respect of prior negotiations for transfer of a capital asset is deductible from the asset's acquisition cost, written down value or fair market value when computing cost of acquisition for capital gains; however, where that advance has already been included in the assessee's total income under the Act's income-inclusion provisions, it shall not be deducted from the cost.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Advance money received reduces cost of acquisition for capital gains unless already included in income.
Advance money received in respect of prior negotiations for transfer of a capital asset is deductible from the asset's acquisition cost, written down value or fair market value when computing cost of acquisition for capital gains; however, where that advance has already been included in the assessee's total income under the Act's income-inclusion provisions, it shall not be deducted from the cost.
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