This provision deals with section 48, defines as the amt which bears cost of acquisition, the same ratio as cost inflation index for the year in which asset is transferred bears cost inflation index for first year in which asset was held or beginning on April, 1981 whichever is higher.
Situation: 1
Capital asset acquired by assess in before april1, 1981 referred in sec 49(1)
Fair market value april1, 1981or cost of acquisition Of asset whichever is more
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× cost inflation index for year in which it occur
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cost inflation index for 1981-82
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Cost of improvement (ignore prior to April 1, 1981)
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× cost inflation index for year in which it occur
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cost inflation index in the year in which improvement took place
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Situation: 2
Capital asset acquired by assess after april1, 1981 referred in sec 49(1)
Cost of acquisition
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× cost inflation index for the first year in which it occur
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cost inflation index for year in which asset is acquired
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Cost of improvement incurred by Assess
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× cost inflation index for the year in which asset is transferred
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cost inflation index for year in which improvement took place
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Situation: 3
Capital asset is acquired by assess before April 1, 1981 and the same is originally acquired by previous owner prior to April 1, 1981
Fair market value april1, 1981or cost of acquisition Of previous owner whichever is more
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× cost inflation index for the year in which asset is transferred
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cost inflation index for 1981-82
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Cost of improvement incurred by assee & previous owner
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× cost inflation index for the year in which asset is transferred
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cost inflation index in year in which it took place
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Situation: 4
Capital asset is acquired by assess after April 1, 1981 but it was acquired by previous owner before April 1, 1981.
Fair market value april1, 1981or cost of acquisition Of previous owner whichever is more
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× cost inflation index for the year in which asset is transferred
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cost inflation index in year in which it took place
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Cost of improvement incurred by assee & previous owner
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× cost inflation index for the year in which asset is transferred
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cost inflation index in year in which it took place
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Situation: 5
This situation covers where capital asset is acquired by assee after April 1, 1981 & it was it was acquired by previous owner April 1, 1981
Cost of acquisition to the previous owner
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× cost inflation index for the year in which asset is transferred
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cost inflation index for year in which asset was held by assess
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Cost of improvement incurred by assee & previous owner
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× cost inflation index for the year in which asset is transferred
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cost inflation index in year in which improvement took place
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