Dismissing the appeal of the revenue the Court held that capital gains arising on transfer of a capital asset acquired by assessee by inheritance, indexed cost of acquisition has to be computed with reference to year in which previous owner first held asset and not year in which assessee became owner of asset. Court also held that the assessee would be entitled to exemption under section 54 where investment in purchase of flat outside India was prior to 1-4-2015. ( AY. 2010 -11 )
CIT v. Saroja Naidu (2021) 281 Taxman 305 (Mad.) (HC )
S. 49 : Capital gains – Previous owner – Cost of acquisition – Indexation – Inheritance – Indexed cost of acquisition has to be computed with reference to year in which previous owner first held asset and not year in which assessee became owner of asset- Property outside India – Entitled to exemption under section 54 where investment in purchase of flat outside India was prior to 1-4-2015 entitled to exemption under section 54 where investment in purchase of flat outside India was prior to 1-4-2015 [ S. 2(42A, )45, 48(iii) ,49(1)(iii)(a), 54, 54F ]