I bought a house in July 2009 and took a loan for the same. Occupancy certificate for the building was already issued when I bought. However, Finishing work was left in the house and Builder gave me posession only in November'09. 100% of payment was made at the time of buying and hence there was no Pre-EMI interest charged by the bank. But I continued staying in my rented flat till November. I am claiming deduction benefit of entire Prinicipal and interest paid by me on the home loan. I want to know if I can claim HRA till November month (I have actually paid rent till this date) or I can claim only till the period when my housing loan EMI started. This is because if there is no Pre-EMI interest, it technically means that the house is ready to move in and hence HRA should not be claimed.

Both the flats are in Mumbai, so can I say that I was staying in a rented flat (although I own a flat) because of occupation purposes, hence I should get HRA benefit.

Thanks & Regards

Dear Ankur,

There is no problem in claiming botth the benefits together, where is the restriction...

U r still talking about split period, HRA exemption as well as repayment of Hosinfg laon together with the interest cab be claimed simuntaneously............. 

Amir is correct in my opinion....because until possession is not given by the builders due to some finishing work,it is not ready to move in,,so assessee can get the benefit of HRA paid for a rented house till the time..and once he moves in the house , he will claim the benefit of housing loan repaid in the form of Interest and Principal.... 

Dear Amir, Thanks for your reply. I also read your answers to the other similar question titled 'Home loan query". Obviously you know the subject, but I still have a doubt:

Let me tweak my question: For the period when I was staying in a rented flat because my own flat was not ready, should the annual value of the owned flat be considered as 'nil' or not. This is because sec 23(2) says that the anuual value can be 'nil' when the property a) is in occupation of the owner for the purpose of his own residence or (b) cannot actually be occupied by the owner by the reason of the fact that owing to his employment, businss or profession carried on at any other place, he has to reside at that other place in a building not belonging to him.

Now (a) may not be applicable since it can not be shown in occupation for residence as it was not ready completely and posession was not given. And I do not have electricity bill etc to show that I stayed there occasionally. Also (b) may not be applicable because both the flats are in the same city, so the criterion of "any other place" is not applicable. Ofcourse it is not clearly defined but I am assuming it means "other city"

So, if both the above criteria are not applicable, then what should be the annual value for this period. I appreciate your time. Thanks

Dear ANKUR,

There is difference between "completion of construction" & "not ready for use"  -

Till the time construction is going on  - no question of determing Annual value be asked?? Since it cannot be said as "Building"

Now "Not Ready to use"- construction is completed but only minor things are left, now "Annual Value" will be computed in this case...- Even in this case the "Annual value would be "Nil" because "any other place" can also be in the same city & not necessarily "another city"...