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2015 (1) TMI 1060 - AT - Income TaxComputation of Capital gain - assessee claimed the deduction (to the extent of 1/6th of his share) while computing the Capital Gain on the sale of development rights in the property at ‘E’ Ward, Dabholkar Corner, Kolhapur in respect of the loan taken by M/s. Mehta Construction but which was not repaid by him and the assessee had to repay the loan to clear encumbrance created by the developer - Held that:- In the present case the loan was borrowed by the Developer M/s. Mehta Construction Co. and we find that it was part of the terms and conditions of the Development Agreement as the developer was allowed to raise the loan against the mortgage of the property for development purpose only. In our opinion the principles laid down by the Hon'ble jurisdicitional High Court in the case of Roshanbabu Mohammed Hussein Merchant (2005 (1) TMI 53 - BOMBAY High Court ) in fact help the assessee as the charged on the property was not by the assessee and other co-owners. We are inclined to allow the grounds taken by the assessee and direct the Assessing Officer to allow claim in respect of bank liability of the developer repaid by the assessee and other co-owners, to extend of assessee’s share u/s. 48(i)/(ii) of the Act. Appeal allowed.
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