Some years ago, the cost of bonus shares was calculated as a proportion of the cost of original shares, the proportion being equal to the bonus ratio. Eg. If the original shares were purchased @Rs. 1000 each and the company declared a 1:1 bonus, the cost of the original as well as the bonus shares, was Rs. 500. Capital gain/loss was calculated based on this cost. Then the IT Act was amended (I do not recall when exactly) to state that the cost of bonus shares was to be taken at 0. The original shares continued with the same cost at which they had been purchased. This may not sound logical, but that is the way capital gain/loss is calculated for tax purpose.
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