Section 49

Cost with reference to certain modes of acquisition.

49. (1) Where the capital asset became the property of the assessee—

 (i) on any distribution of assets on the total or partial partition of a Hindu undivided family ;

(ii) under a gift or will ;

(iii) (a) by succession inheritance or devolution, or

(b) on any distribution of assets on the dissolution of a firm, body of individuals or other association of persons, or

(c) on any distribution of assets on the liquidation of a company, or

(d) under a transfer to a revocable or an irrevocable trust or

(e) under any such transfer as is referred to in clause (iv) or clause (v) ⁵³[or clause (vi)] of section 47,

the cost of acquisition of the asset shall be deemed to be the cost for which the previous owner of the property acquired it, as increased by the cost of any improvement of the assets incurred or borne by the previous owner to the assessee, as the case may be.

⁵³[Explanation.—In this ⁵⁴[sub-section] the expression "previous owner of the property'' in relation to any capital asset owned by an assessee means the last previous owner of the capital asset who acquired it by a mode of acquisition other than that referred to in clause (i) or clause (ii) or clause (in) of this ⁵⁴[sub-section.]

⁵⁴[(2) Where the capital asset being a share or shares in an amalgamated company which is an Indian company became the property of the assessee in consideration of a transfer referred to in clause (vii) of section 47, the cost of acquisition of the asset shall be deemed to be the cost of acquisition to him of the share or shares in the amalgamating company.]

 

 

[As amended by Finance Act, 1970]