The prices of the goods and various products increase with the time due to the constant globalization of the world. The Cost Inflation Index (CII) is a technique for measuring inflation-related increases in the cost of goods and assets over time and deciding the actual price of the asset as per the recent rates and inflation caused due to time. The prices of the goods or assets automatically increase if the inflation rate increases.
The current Cost Inflation Index (CII) of India is about 317 and you can see it increasing day by day due to the constant developments.
For example:
In the fiscal year 2004-05, Rahul paid Rs.20,00,000 for a flat. In the fiscal year 2020-21, he sold the flat. What will the acquisition cost?
In this scenario, CII is 113 and 301 for the years 2004-05 and 2020-21, respectively.
As a result, the indexed acquisition cost is 20,00,000 x 301/113 = Rs.53,27,433.
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Authors Of The Question
What is CII
BEVVNMurthy
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2022-01-24T10:48:17+00:00 2022-01-27T21:57:13+00:00Comment
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