Calculating Indexed acquisition cost of a property for estimation of LTCG

I Have few doubts regarding how to calculate Indexed acquisition cost of a property. These are:-

  1. Property was purchased in FY 2009-10 & 85% money was paid to builder. Registration & Sale Agreement was carried out same time. But as it was under construction property, Possession was given in FY 2010-11 & rest 15% paid. So Which year CII will be used for indexation purpose?
  2. Stamp duty & registration charges paid during purchasing of this property will be added in property cost or not?
    Please clear my doubt.
    Thank you

Hi @Exploremind

Here are answers to your questions.

  1. The CII will be used for the year in which the registration of the property was done.
    You can read more about Cost Inflation Index : CII Income Tax - Learn by Quicko.

  2. The stamp duty & registration charges paid during purchasing of this property will be added in the property cost.

Hope this helps.

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Thank you very much…

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Can you review this question in relation to the article here which speaks of a case decided by the High Court where the purchase date was taken as the date when the entire consideration amount was paid and possession received and not the registration date.


The contention of the assessee is that since final consideration was paid and the possession of flat was received within a period of one year prior to the date of transfer of capital asset, the same should be considered as the date of purchase. Whereas, the stand of Department is that the date of execution of agreement for purchase of flat should be considered as the date of purchase. The Hon’ble Bombay High Court in the case of CIT Vs. Smt. Beena K. Jain decided the issue in favour of the assessee

Another article also speaks of a ruling by ITAT about the same.

Hi @Exploremind

In my viewpoint,

  1. The sale agreement was carried out during the year (FY 2010-11) only and so take
    indexation for that year as it is your cost of acquisition. The Cost Inflation Index shall be
    taken for the first year in which the asset was held by the assessee or for the year
    beginning on the 1st day of April, 1981, whichever is later;

    The word "held" means that you should have some right in the property which in your 
    case is vested by way of agreement during the FY 2010-11. Therefore possession and 
    payment is irrelevant in your case.
  2. Yes, registration charges and stamp duty value are part of cost of acquisition and should
    be indexed.

Thank you!