Income Tax Act, 2025
Section 13: Subs. by Act 20 of 1967, s. 21, for “section 49” (w.e.f. 11967).
13. Subs. by Act 20 of 1967, s. 21, for “section 49” (w.e.f. 11967).
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(2) 1[For the purposes of sections 48 and 49, “cost of acquisition”,—
2[(a) in relation to a capital asset, being goodwill of a business 3[or a trade mark or brand name
associated with a business] 4[or a right to manufacture, produce or process any article or thing]5[or
right to carry on any business 6[or profession]], tenancy rights, stage carriage permits or loom
hours,—
(i) in the case of acquisition of such asset by the assessee by purchase from a previous
owner, means the amount of the purchase price; and
(ii) in any other case [not being a case falling under sub-clauses (i) to (iv) of sub-section (1)
of section 49], shall be taken to be nil ;
(aa) 7[in a case where, by virtue of holding a capital asset, being a share or any other security,
within the meaning of clause (h) of section 2 of the Securities Contracts (Regulation) Act, 1956 (42 of
1956) (hereafter in this clause referred to as the financial asset), the assessee—
(A) becomes entitled to subscribe to any additional financial asset; or
(B) is allotted any additional financial asset without any payment,
then, subject to the provisions of sub-clauses (i) and (ii) of clause (b),—
(i) in relation to the original financial asset, on the basis of which the assessee becomes
entitled to any additional financial asset, means the amount actually paid for acquiring the
original financial asset;
(ii) in relation to any right to renounce the said entitlement to subscribe to the financial asset,
when such right is renounced by the assessee in favour of any person, shall be taken to be nil in
the case of such assessee;
(iii) in relation to the financial asset, to which the assessee has subscribed on the basis of the
said entitlement, means the amount actually paid by him for acquiring such asset;
8[(iiia) in relation to the financial asset allotted to the assessee without any payment and on
the basis of holding of any other financial asset, shall be taken to be nil in the case of such
assessee;] and
(iv) in relation to any financial asset purchased by any person in whose favour the right to
subscribe to such asset has been renounced, means the aggregate of the amount of the purchase
price paid by him to the person renouncing such right and the amount paid by him to the
company or institution, as the case may be, for acquiring such financial asset;]
9[(ab) in relation to a capital asset, being equity share or shares allotted to a shareholder of a
recognised stock exchange in India under a scheme for 10[demutualisation or corporatisation]
approved by the Securities and Exchange Board of India established under section 3 of the Securities
and Exchange Board of India Act, 1992 (15 of 1992), shall be the cost of acquisition of his original
membership of the exchange:
1. Subs. by Act 11 of 1987, s. 25, for the “For the purposes of sections 48 and 49, “cost of acquisition”, in relation to a
capital asset,—” (w.e.f. 11988).
1[For the purposes of sections 48 and 49, “cost of acquisition”,—
2[
in relation to a capital asset, being goodwill of a business 3[or a trade mark or brand name
associated with a business] 4[or a right to manufacture, produce or process any article or thing]5[or
right to carry on any business 6[or profession]], tenancy rights, stage carriage permits or loom
hours,—
in the case of acquisition of such asset by the assessee by purchase from a previous
owner, means the amount of the purchase price; and
in any other case [not being a case falling under sub-clauses
to
of sub-section
of section 49], shall be taken to be nil ;
7[in a case where, by virtue of holding a capital asset, being a share or any other security,
within the meaning of clause
of section 2 of the Securities Contracts
Act, 1956 (42 of
1956) (hereafter in this clause referred to as the financial asset), the assessee—
becomes entitled to subscribe to any additional financial asset; or
is allotted any additional financial asset without any payment,
then, subject to the provisions of sub-clauses
and
of clause
in relation to the original financial asset, on the basis of which the assessee becomes
entitled to any additional financial asset, means the amount actually paid for acquiring the
original financial asset;
in relation to any right to renounce the said entitlement to subscribe to the financial asset,
when such right is renounced by the assessee in favour of any person, shall be taken to be nil in
the case of such assessee;
in relation to the financial asset, to which the assessee has subscribed on the basis of the
said entitlement, means the amount actually paid by him for acquiring such asset;
8[
in relation to the financial asset allotted to the assessee without any payment and on
the basis of holding of any other financial asset, shall be taken to be nil in the case of such
assessee;] and
in relation to any financial asset purchased by any person in whose favour the right to
subscribe to such asset has been renounced, means the aggregate of the amount of the purchase
price paid by him to the person renouncing such right and the amount paid by him to the
company or institution, as the case may be, for acquiring such financial asset;]
9[
in relation to a capital asset, being equity share or shares allotted to a shareholder of a
recognised stock exchange in India under a scheme for 10[demutualisation or corporatisation]
approved by the Securities and Exchange Board of India established under section 3 of the Securities
and Exchange Board of India Act, 1992 (15 of 1992), shall be the cost of acquisition of his original
membership of the exchange:
1. Subs. by Act 11 of 1987, s. 25, for the “For the purposes of sections 48 and 49, “cost of acquisition”, in relation to a
capital asset,—” (w.e.f. 11988).