https://www.taxtmi.com/caselaws?id=13855 For computing capital gains under ss. 48 and 55(2) of the Income-tax Act, the dominant issue was whether mortgage expenses and interest on borrowed funds used to pay the sale consideration form part of "cost of acquisition." The HC held that cost of acquisition includes not only the amount paid to the vendor but also the directly attributable cost of borrowing undertaken to acquire the property, since the purchase was financed by the loan and the mortgage was a necessary incident to secure that borrowing; execution of the mortgage after the sale deed (though on the same day) did not break this nexus. Applying the SC ratio in Challapalli Sugars, the HC answered the reference in favour of the assessee and against the Revenue. en-us Mon, 20 Nov 2000 00:00:00 +0530 Sun, 04 Jan 2026 21:58:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=13855 For computing capital gains under ss. 48 and 55(2) of the Income-tax Act, the dominant issue was whether mortgage expenses and interest on borrowed funds used to pay the sale consideration form part of "cost of acquisition." The HC held that cost of acquisition includes not only the amount paid to the vendor but also the directly attributable cost of borrowing undertaken to acquire the property, since the purchase was financed by the loan and the mortgage was a necessary incident to secure that borrowing; execution of the mortgage after the sale deed (though on the same day) did not break this nexus. Applying the SC ratio in Challapalli Sugars, the HC answered the reference in favour of the assessee and against the Revenue. Case-Laws Income Tax Mon, 20 Nov 2000 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=13855