2018 (2) TMI 1378

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....ld by the assessee?" [B] Whether the Appellate Tribunal erred in law while computing the capital gains arising on transfer of a capital asset acquired by the assessee under a gift, whether the indexed cost of acquisition has to be computed with reference to the year in which the previous owner first held the asset or the year in which the assessee became the owner of the asset?" 2. These two questions involve a common issue. The date on which the cost of indexation will be paid back for the purpose of computing capital gain tax in the hands of the assessee. Admitted facts are that the shares which are the subject matter of capital gains tax were purchased by the father of the assessee on 01.08.1989. They were gifted by him to his son o....

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....flation Index in the year in which assessees asset is transferred to the Cost of Inflation Index for the year beginning on 1.4.1981. It was therefore, that the Tribunal in our opinion correctly held that the indexed cost of acquisition shall have to be worked out with reference to 1.4.1981 since in the present case the asset was acquired by the previous owner of the property. Learned counsel for the Revenue however, submitted that such interpretation would fail to take into account the expression Cost Inflation Index for the first year in which the asset was held by the assessee. In his opinion the assessee referred to under such expression would be the present assessee and not the previous owner. In our opinion, such interpretation cannot ....