Please go through the following question and provide the answer for it:
Mr.A purchased a piece of land for Rs. 10,000 on 01/08/1972. During 1984-85, he constructed a Residential House Property on that land by incurring Rs. 50,000. Again during 1993-94, he incurred Rs. 80,000 for improvement of the property which is capital expenditure in nature. On 24/04/2002, Mr. A expired as a result of which Mr.B (son of Mr. A) has become the owner of the property by succession. During 2007-08, Mr. B incurred Rs. 100,000 for improvement of the property which is capital expenditure in nature. On 10/10/2011, Mr. B sold the property for Rs. 85 lakhs. The Market value of the property as on April 01, 1981 is Rs. 18,000.
Calculate the Capital gains on the transfer of property by Mr. B assuming that Rs. 2 lakhs is incurred as stamp duty, registration charges and brokerage.
Especially here I request you to give a detailed clarification regarding the amount to be taken as Cost of acquisition and Cost of improvement. And also specify as to from which year the indexation will be taken for the various amounts incurred by Mr. A and Mr. B.
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