https://www.taxtmi.com/caselaws?id=800564 Shares received by gift and taxed on their fair market value retain their character as gifts; the previous owner's holding period is included when determining whether they are long-term capital assets. Taxation of the gift value changes the statutory cost of acquisition, not the holding-period rule. The deemed cost, being the value subjected to tax, qualifies for indexation when computing long-term capital gains. However, indexation applies only from the financial year in which that deemed cost arose through taxation, rather than from the period during which the previous owner held the shares. en-us Wed, 23 Sep 2026 00:00:00 +0530 Thu, 08 Oct 2026 08:45:24 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=800564 Shares received by gift and taxed on their fair market value retain their character as gifts; the previous owner's holding period is included when determining whether they are long-term capital assets. Taxation of the gift value changes the statutory cost of acquisition, not the holding-period rule. The deemed cost, being the value subjected to tax, qualifies for indexation when computing long-term capital gains. However, indexation applies only from the financial year in which that deemed cost arose through taxation, rather than from the period during which the previous owner held the shares. Case-Laws Income Tax Wed, 23 Sep 2026 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=800564