The assessee and her co-owners offered property owned by them as collateral security for a bank loan and stood as guarantors, for the loan. The mortgage was by deposit of title deeds. Since the loan was not repaid, the assessee and the other two co-owners consented to sale of the property by the bank to realise its dues and the total sale consideration was paid to the bank by the purchaser. The AO has not allowed the deduction in respect of sale proceeds paid to mortgagee  which was up held by the Tribunal  On appeal  dismissing the appeal,  the Court held  that the Tribunal was right in holding that the assessee was not entitled to claim deduction under section 48 since mortgage was created by the assessee herself and that it was not a case where the property had been mortgaged by the previous owner and the assessee had acquired only the mortgagor’s interest in the property mortgaged and by clearing the same he had acquired the interest of the mortgagee in the property.

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