Cost Inflation Index for FY 2023-24 is 348 — used to compute indexed cost on long-term capital assets and grandfathered land or building under FY 2026-27 rules.
The Cost Inflation Index is the CBDT-notified factor used to inflate the cost of acquisition and improvement of long-term capital assets to compute indexed cost — the basis on which long-term capital gains are taxed. For FY 2023-24 (AY 2024-25), CBDT notified the CII at 348. With Finance Act 2024 amendments, indexation was abolished for several asset classes from 23 July 2024, but the CII still applies to many ongoing computations and historical bases through FY 2026-27.
CII for Recent Years
- FY 2001-02 (base year) — 100
- FY 2020-21 — 301
- FY 2021-22 — 317
- FY 2022-23 — 331
- FY 2023-24 — 348
- FY 2024-25 — 363 (final use for indexation eligible assets)
How Indexation Works
Indexed cost = Cost of acquisition multiplied by (CII of year of transfer / CII of year of acquisition or FY 2001-02, whichever is later). For an asset bought in FY 2010-11 (CII 167) for ₹50 lakh and sold in FY 2023-24 (CII 348), indexed cost equals 50,00,000 multiplied by 348 / 167 = ₹1,04,19,162. If sale consideration was ₹1.5 crore, the indexed LTCG is ₹45,80,838.
What Indexation Applied To Before 23 July 2024
- Land and building held for more than 24 months.
- Listed bonds and debentures (with carve-outs).
- Gold, silver, jewellery, art and collectibles.
- Unlisted shares and securities.
- Debt mutual funds purchased before 1 April 2023.
Post-July-2024 Regime Change
Finance Act 2024 abolished indexation for most long-term assets transferred on or after 23 July 2024, reducing the LTCG rate to a flat 12.5% without indexation. A grandfathering option was provided for resident individuals and HUFs on land or building purchased before 23 July 2024 — they can compute tax at 20% with indexation or 12.5% without, whichever is lower. Use the CII tables for the with-indexation computation.
Where CII Still Matters in FY 2026-27
Updated returns under section 139(8A) for prior years still use the relevant CII. Reassessments, refund claims, capital-gains-bond reinvestment computations under section 54EC, and the grandfathered land-and-building option all require CII application. For non-grandfathered assets, indexation is no longer relevant for transfers after 23 July 2024.
Practical Checklist
- Maintain original purchase documents, registered deeds and improvement bills.
- Compute both with-indexation and without-indexation tax to choose the better option where grandfathering applies.
- Use Form 26AS, AIS and broker statements for cost data on listed securities.
- File ITR Schedule CG with correct CII years and amounts.
- Reinvest gains in section 54, 54EC or 54F instruments before the prescribed time limits.
Conclusion
The CII for FY 2023-24 is 348, and the table still drives capital gains computation on historic and grandfathered assets in FY 2026-27. Get the index right, document the original cost, and pick the optimal indexation path for legitimate tax savings.
