Interest on Borrowed Funds Forms Part of Cost of Acquisition: ITAT Delhi

Advertisement ACIT Vs Smt. Sadhna Aggarwal (ITAT Delhi) The ITAT Delhi adjudicated the Revenue’s appeal against the order of the CIT(A), which had deleted various disallowances made while computing the assessee’s long-term capital loss on sale of a residential property. The principal issue was whether interest paid on borrowed funds used for acquiring the property formed part of the cost of acquisition under Section 48 of the Income-tax Act. The Assessing Officer had disallowed the interest on the ground that it was allowable only under Section 24 and not under Section 48. The C...