Miss, Nargis, purchased a residential house property in Jaipur for ₹1,20,000 on 15th May, 1975. She further incurred expenses on additions/alteration and modification in respect of the said house property in different ye

Computation of Capital Gains for AY 2019-20 Particulars Amount (₹) Gross sale consideration is taken as per section 50C of Income Tax, 1961 which is the value assessed by the stamp valuation authority being the same is higher than the actual consideration on transfer 85,00,000 Less: Expenses on transfer (50,000) Net Sale Consideration 84,50,000 Less: Indexed cost of acquisition (Note-(i)) (35,00,000) Less: Indexed cost of improvement (Note-ii) (33,73,333) Long-term Capital Gain 15,76,667 Working Notes: Fair market value on 1st April, 2001 of ₹12,50,000 is to be taken as the cost of acquisition for the house property as the same is higher than the actual cost of acquisition incurred as on 15th May, 1975. The indexed cost of acquisition thus shall be: ₹12,50,000 x 280/100 = ₹35,00,000. Indexed cost of improvement is determined as under : Particulars of Expenses on improvement Amount (₹) Construction of first floor in 1982-83* (Expenses incurred prior to 1st April, 2001 is to be ignored whether the assessee opts for the fair market value as on 01.04.2001 or not. Nil Construction of second floor in the year 2002-03 (₹9,50,000 x 280/105) 25,33,333 Alteration/modification/addition in the year 2012-13 (₹6,00,000 x 280/200) 8,40,000 Indexed cost of improvement 33,73,333 * (since FMV as on 1st April, 2001 is adjusted, any cost incurred prior to this date must be ignored)