Ram has purchased shop of Rs 10 lac in 2005. He gift that shop to his brother Mohan in 2008 and same is registered in property registration office. Mr mohan sold 30 lac this shop in April 2019 to other person. what is the cost of acquisition in the hand of Mr Mohan.Rs 10 lacs or zero.
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Capital gain
Replies (4)
zero
cost of acquisition to be taken as cost to previous owner and hence cost of acquisition in this case would be 10 lakhs
consider the cost of acquisition of previous owner i.e 10lakhs.
When an asset is gifted or inherited, the taxpayer does not have a purchase price he can attribute to the asset. To address this, the law itself has discussed certain scenarios which includes a case of gift or inheritance, where the purchase price of the previous owner would be treated as the purchase price for computing capital gains of the taxpayer.
Therefore in your case, Rs. 10 Lakhs will be the Cost of Acquisition.
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