Cost of Acquisition as on 1.4.2001 for properties purchased prior to 2001- Clarification

CBDT has clarified the question as to what would be the Cost of Acquisition as on 1.4.2001 for properties purchased prior to 2001 under new Capital Gain Tax Regime.

With introduction of new Capital Gain Tax Regime by Union Budget 2024-25, many doubts have arisen. CBDT has recently issued  13 FAQ to answer these doubts. An issue has been raised as to what would be the Cost of Acquisition as on 1.4.2001 for properties purchased prior to 2001. CBDT has answered it as under:

For properties (land or building or both) purchased prior to 1.4.2001, the cost of acquisition as on 1.4.2001 shall be:-

(i) Cost of Acquisition of the asset to the assesse; or

(ii) the Fair Market Value (not exceeding the stamp duty value, wherever available) of such asset as on 1.4.2001.

Taxpayers can choose either option as per section 55(2)(b) of the Income-tax Act, 1961.

An illustration to explain the same is as under:

The taxpayer will have the option to avail roll over benefits for saving of tax.

ABCAUS Note: benefit of Indexed Cost of acquisition shall be available only for the transfers which takes place before the 23rd day of July, 2024

• Taxes on sales comprising in turnover to be excluded for estimating net profit
• Capital contribution deposited in assessee’s bank not partnership firm – Addition 69A upheld
• Bail granted to a CA accused in a GST evasion of more than 40 crores
• Every provision invoked casts a different onus, quoting wrong section prejudice the assessee
• Liability under MV Act can’t be decided on the grounds of sympathy alone – Supreme Court