A.R. KRISHNAMURTHY & ANR. vs C.I.T. MADRAS

The Supreme Court held that the grant of a mining lease constitutes a transfer of a capital asset under Section 45 of the Income-tax Act, 1961. The Court clarified that the 'cost of acquisition' of the land includes the rights granted under the lease, establishing a direct nexus between the two. The appeal was dismissed, affirming that the computation provisions of the Act apply to the valuation of leasehold rights, and the date of acquisition of the lease rights aligns with the acquisition of freehold rights.