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Allotment letter adequate proof of investment in flat: ITAT

The ITAT, Mumbai bench, has upheld that a letter of allotment from the builder is sufficient proof of investment in a new house. The ITAT held that a substantial amount was paid on the basis of the letter of allotment, and the taxpayer was therefore entitled to the benefit of LTCG exemption on reinvestment in a residential house. In this particular case, the I-T department had denied the deductions from LTCGs claimed by the taxpayer. Its contention was that the amounts paid by the taxpayer under the letter of allotment are in the nature of an advance to the builder.

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