Bonus Shares Have Nil Acquisition Cost for Capital Gains Calculation: ITAT Bangalore

Zash Traders Vs ACIT (ITAT Bangalore) In the case of Zash Traders vs. ACIT (Income Tax Appellate Tribunal, Bangalore), the dispute revolves around the taxation treatment of bonus shares under the Income Tax Act, specifically focusing on the interpretation of Section 55(2)(aa)(B)(iiia) and its application in computing capital gains. Here’s a detailed summary of the case and the arguments presented: Background and Legal Framework Section 55 of the Income Tax Act defines various terms relevant to the computation of capital gains, including “cost of acquisition.” Before the intro...