9911796707
TMI Blog1993 (7) TMI 246X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome- tax Act, 1961, the following question is referred to us for our decision : "Whether, on the facts and in the circumstances of the case, the cost of acquisition of the 300 shares in Alembic Chemicals Industries and 200 shares in Alembic Glass Industries, sold by the assessee during the previous year relevant to the assessment year in question, should be determined on the basis of the actual ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rding to the assessee, the cost of acquisition for the purpose of computation of capital gains should be worked out only on the basis of the actual cost incurred by the assessee, i.e., the price paid for the purchase of these shares. However, according to the revenue, bonus shares had been issued to the assessee on the basis of the assessee's shareholding in the said companies, accruing on those s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e required to be computed, were shares purchased from the market and in respect of which the cost of acquisition was specifically indicated by the assessee. The principle of averaging out was not applied by the Tribunal on the basis of its observation that the facts of the present case are distinguish- able from the case of Miss Dhun Dadabhoy Kapadia v. CIT [1967] 63 ITR 651 (SC), inasmuch as, in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rely with regard to the cost of bonus shares. The Supreme Court had worked out the cost of original as well as bonus shares by spreading the cost of original shares over the original shares and the bonus shares. Hence, for the purpose of working out capital gains arising out of sale of original shares, the cost of shares to be deducted from the sale proceeds should be worked out by spreading the c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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