https://www.taxtmi.com/caselaws?id=49399 Bonus shares issued by capitalisation of reserves and ranking pari passu with original shares are not treated as having a face-value or nil cost merely because no cash is paid on issue. The correct approach is to determine the real commercial and tax cost of the bonus shares by apportioning the original purchase price of the old shares over the original and bonus shares taken together, since the bonus issue diminishes the value of the original holding and the two holdings together represent the same capital interest. The face-value and nil-cost methods were rejected as inconsistent with business accounting principles. en-us Fri, 13 Mar 1964 00:00:00 +0530 Sun, 24 Aug 2014 16:32:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=49399 Bonus shares issued by capitalisation of reserves and ranking pari passu with original shares are not treated as having a face-value or nil cost merely because no cash is paid on issue. The correct approach is to determine the real commercial and tax cost of the bonus shares by apportioning the original purchase price of the old shares over the original and bonus shares taken together, since the bonus issue diminishes the value of the original holding and the two holdings together represent the same capital interest. The face-value and nil-cost methods were rejected as inconsistent with business accounting principles. Case-Laws Income Tax Fri, 13 Mar 1964 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=49399