Interest on Borrowed Capital

only the house owner can claim exemption / deduction. 

Yes, there is a way for the wife to claim the interest deduction u/s 24(b).

Let the husband make a transfer equal to the loan amount (to wife's account).  Consider the same as loan.  and let the wife refund the same to husband immediately (Consider it as gift from wife to husband.  it is not taxable in the hands of husband).  Now let the husband transfer the amount which is equal to interest paid to bank (Consider it as gift from husband to wife - Not taxable).  Now transfer immediately the same interest to husband (Consider the same as interest on housing loan repayment).  Since 24(b) does not restrict borrowing only from banks, fi and all those, loans from any one can be accepted for interest deduction u/s 24(b).

Coming to principal repayment u/s 80C, there is a condition that the repayment made to banks, fi's are only eligible for deduction.  Hence, you cannot claim principal repayment. but can claim interest repayment u/s 24(b).