Cost of the previous owner
Regulation & taxWhere a capital asset is received by gift, will or inheritance, the cost taken for computing the eventual gain is the cost to the person who last acquired it by purchase, and the holding period includes theirs.
In plain terms
Not the value on the day it was given to you, which is what almost everybody assumes. The depository moves the security and never the cost or the date, so the recipient needs the original contract notes handed over or the gain will be computed from nothing.