https://www.taxtmi.com/caselaws?id=11916 Expenditure is deductible under s. 48 only if incurred wholly and exclusively in connection with transfer of a capital asset. The HC held that amounts paid to settle pending litigation and claims had an intimate nexus with the transfer of the undertaking because continuation of litigation would have impeded completion of the sale and realisation of consideration; therefore such payments and related litigation costs were incurred wholly and exclusively in connection with the transfer and were deductible. The HC further held that a sum paid by the purchaser to settle the claimant's demand was received in connection with the transfer and formed part of the sale consideration; however, since the assessee made the corresponding payment, it simultaneously qualified as deductible transfer expenditure. The revenue's challenge failed. en-us Wed, 18 Sep 2002 00:00:00 +0530 Wed, 24 Dec 2025 20:37:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=11916 Expenditure is deductible under s. 48 only if incurred wholly and exclusively in connection with transfer of a capital asset. The HC held that amounts paid to settle pending litigation and claims had an intimate nexus with the transfer of the undertaking because continuation of litigation would have impeded completion of the sale and realisation of consideration; therefore such payments and related litigation costs were incurred wholly and exclusively in connection with the transfer and were deductible. The HC further held that a sum paid by the purchaser to settle the claimant's demand was received in connection with the transfer and formed part of the sale consideration; however, since the assessee made the corresponding payment, it simultaneously qualified as deductible transfer expenditure. The revenue's challenge failed. Case-Laws Income Tax Wed, 18 Sep 2002 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=11916