ITAT Mumbai: NRI’s ESOP shares get FMV as cost of acquisition, not original purchase price

The Mumbai bench of the Income Tax Appellate Tribunal ruled that the fair market value of ESOP shares at exercise becomes the cost of acquisition for capital gains. Divya Bhanushali said, “ESOP taxation isn't a single event; it's a two-stage process.” This decision helps NRI employees avoid potential double taxation issues.