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2020 (12) TMI 1081 - HC - Income TaxComputation of capital gain - Cost of acquisition- diversion of the sale proceeds towards redeeming the interest of the mortgagor - whether no part of the consideration for sale was received by the appellant and same was directly paid to the Bank by the purchaser in discharge of the mortgage amount - claim that amount paid to bank towards clearing the cloud over the title should be deducted as provided u/s 48 as expenditure incurred wholly and exclusively in connection with such transfer - HELD THAT:- Issue decided in TMT. D. ZEENATH [2019 (4) TMI 817 - MADRAS HIGH COURT] mortgage deed was never registered and State Bank of India, Pondicherry did not have a right to bring the property to sale. The assessee in the present case, continued to have title over the property along with her co-owners. They brought the property to sale through Bank - there was no diversion of sale proceeds by virtue of overriding title, but on the contrary, there was only a mere application by the owners themselves of the profits realized on the sale of land towards the discharge of loan obligations of same firm. We also hold that the assessee cannot claim any part of such application as cost of acquisition for the purpose of computing capital gains as per the provisions of Section 48. - Decided in favour of revenue.
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