TaxTMI 
TaxTMI 
In case of gifted property, what should be the Cost Inflation Index (CII) rate we have to apply to arrive at the cost for the purpose of calculating capital gains? Is it CII of the year in which the original owner (Donor) became the owner of the property or of the year on which the donee receives the gift?
Gifted property - Cost Inflation Index
22 Oct 2009 
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Indexed cost of acquisition: apply previous owner's acquisition year for inflation indexing on gifted property to avoid anomalies.
Whether CII for a gifted asset is taken as of the year the donee received the gift or the year the previous owner acquired it; one reading applies CII of the year the asset is held by the assessee (donee), while a purposive construction applies CII of the previous owner's year of acquisition (or the prescribed base-date FMV where applicable), treating the previous owner's holding period and improvement years as carrying over to the donee to avoid indexing anomalies. (AI Summary)
Whether CII for a gifted asset is taken as of the year the donee received the gift or the year the previous owner acquired it; one reading applies CII of the year the asset is held by the assessee (donee), while a purposive construction applies CII of the previous owner's year of acquisition (or the prescribed base-date FMV where applicable), treating the previous owner's holding period and improvement years as carrying over to the donee to avoid indexing anomalies. (AI Summary)