Capital gain

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commstudies (Querist)
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17 November 2013 In case of property acquired by way of will or inheritance ,what are the rules of indexation? In the denominator ,do we keep the index for the year of acquisition by the previous owner or the year of inheritance by the present owner or the index for 1981-82(100)?

Thanks in advance.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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17 November 2013 assuming that the assessee inherited the asset before 1981 or that the asset was originally bought (by the ancestors) before 1981, the cost of the asset shall be fair market value of the asset as on 1/4/1981. the indexation shall apply from 1981-82 itself.

Even in case, the assessee inherited the asset after 1981 lets say 1990, the indexation shall be from 1990 only on the cost of the previous owner.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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17 November 2013 this wonderful article by Sandeep Shanbhag should be helpful for you:

http://www.dnaindia.com/analysis/column-how-to-compute-capital-gains-on-your-inherited-property-1589601

commstudies

commstudies (Querist)
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17 November 2013 Thank You very much Sir for your help. I have one further query. If suppose the previous owner acquired the asset after 1981 say in 1990 and the assesses inherited the asset in 2001 ,in such a case will 1990 or 2001 be the base year for indexing?

Nikhil Kaushik

Nikhil Kaushik (Expert)
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17 November 2013 2001...that is what i said....go through this article...it covers all the possibilities..

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