TMI Blog2012 (12) TMI 752X X X X Extracts X X X X X X X X Extracts X X X X ..... llowing the appeal of the assessee and in coming to the conclusion that transfer of property has taken place way back in the financial year 1988-89. Moreover, it was the liability of the assessee to redeem the mortgage. The assessee cannot claim the redemption amount as deduction under the unambiguous provisions of section 48 to arrive at the capital gains - Impugned order of the CIT(A) is set aside and allow the appeal of the Revenue - appeal of Revenue is allowed. - ITA No.1068/Mds/2011 - - - Dated:- 5-6-2012 - Dr. O.K. NARAYANAN, AND SHRI VIKAS AWASTHY, JJ. Appellant by : Dr. Yogesh Kamath, IRS, JCIT O R D E R PER VIKAS AWASTHY, JUDICIAL MEMBER: The appeal has been filed by the Revenue assailing the order of the CIT(A), ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as a collateral security for getting loan sanctioned for construction of super structure by the firm on the land held by the assessee. He submitted that on the loan taken by the firm the benefit of section 48(i) is not admissible. In order to support his contentions, he relied on the judgement of the Hon ble Bombay High Court in the case of CIT Vs. Roshanbabu Mohammed Hussein Merchant reported as 275 ITR 231(Bom) and the judgement of the Hon ble Kerala High Court in the case of Salay Mohamad Ibrahim Sait Vs. ITO reported as 210 ITR 700. He further submitted that the CIT(A) has erred in following the ratio laid down by the Hon ble Guwahati High Court in the case of B.C.Gupta Sons Ltd. Vs. CIT., reported as 221 ITR 53 and by the Hon ble Ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the indexed cost of acquisition was arrived at Rs. 63,504/-. This resulted in long term capital gain of Rs. 47,59,496/- which was assessed in the hands of the assessee. The assessee had contended before the CIT(A) that the firm had taken over the possession of the property way back in the year relevant to the assessment year 1983-84. The adverse possession of the property by the firm signifies the possession and enjoyment to the detriment to the assessee and the allowance of depreciation to the firm on the RCC roofed terrace building confirms the possession and enjoyment of the property by the firm. M/s. Kanniah Photo Studio had taken loan from the bank for construction of the super structure on the land of the assessee. The assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the land. Throughout the land was owned by the assessee. Had it been so, the assessee would not have shown loss on the sale of land in his return filed in response to the notice under section 142(1). To interpret the term transfer as defined under section 2(47)(vi) of the Act in favour of the assessee in the instant case is too far fetched. The expressions defined in the Act cannot be interpreted according to the convenience. The same have to be interpreted in the strict sense especially when the definitions are inclusive . The relevant extract of section 2(47)(vi) is reproduced herein below:- 2(47)"transfer", in relation to a capital asset, includes - (vi) any transaction (whether by way of becoming a member of, or acquiring shar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mount paid for discharging the mortgage is thus part of the consideration for the vendor parting with his rights in the property. The Hon ble Court also held that the amounts spent for discharge of the mortgage is not liable to be deducted in the computation of capital gains under section 48 of the Act. The Hon ble Division Bench of the Bombay High Court in the case of Rosanbabu Mohammed Hussein Merchant (supra) has also taken similar view. The Hon ble Court held that the assessee is not entitled to the deduction of the expenditure incurred to remove encumbrance created by the assessee himself. Thus, in view of the above said judgements and in the facts and circumstances of the case, we are of the considered opinion that the CIT(A) has ..... X X X X Extracts X X X X X X X X Extracts X X X X
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