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pls help very urgent

som kansal (chartered accountant) (307 Points)

24 January 2008

hi there
the assesse availed a house loan for construction on his name and his wife. the property is on wife's name. after that he claimed refind of tax on the base of rebate for interest and principal repayment where he was not eligible to get the refund for the same as the property is on his wife's name.
the refund was granted and now the demand is raised. can u pls help me by telling any eligible way for saving the client

pls help, its urgent

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8 Replies

CA Chaitanya (PRACTISING CA) (4283 Points)
Replied 24 January 2008

He has to pay the tax on the amount claimed as deduction.

student (WORKING) (757 Points)
Replied 24 January 2008

THERE IS NO WAY TO SAVE THE CLIENT SINCE THE PROPERTY IS IN THE NAME OF WIFE. THEREFORE LOAN HAD BEEN PASSED IN THE WIFE NAME ONLY. THEREFORE IT IS BETTER IF U PAY TAX WHICH IS RAISED ON DEMAND

HARANATH (Profession) (186 Points)
Replied 25 January 2008

hai friend, i hope u cant claim refund. but i can suggest one thing,that is u can claim deduction u/s 80C for stamp duty paid at the time registration of property. gud luck

student (WORKING) (757 Points)
Replied 25 January 2008

u can claim stamp duty as deduction only if u have claimed it as deduction while claiming refund.

(Guest)

From the querry it appears that only the land is in the name of wife. In that case if the loan amount was utilised for construction of building your client can claim deduction, since in India land and superstructure can be owned by different persons. If necessary the wife can execute a license agreement in favour of husband.

(Guest)

I also agree to it. But it is very difficult to create an evidence for lease now as u can not get it registered now. Without registration of lease deed at registrar, the contention may not be so strong. Further, whose funds have been used for construction over and above of loan ? If husbands funds have been used for even purchasing land in the name of wife, then u may fight.

(Guest)

It has been stated that though initially the Refund was granted, the assessee was subsequently reassessed and demand notice was raised by the dept. I need 2 inputs before a conclusion can be inferred from the stated facts :- (a) What is the source of finance for the "House Property" held in the name of the assessee's spouse ? Isn't it finance by the borrowing made by the assessee ? (b) What about the Clubbing provisions fo Sec 64 ?

pushpendra (Director- FinMAT Consultants) (1703 Points)
Replied 28 January 2008

Dear One, Can u tell me about the status of his wife. either she files his return or not. if she is not an assessee and propety in her name but fund used for purchase of that poroperty if of husband's source. than u can take a plea that Under section 27 husband is deemed owner and eligible for rebate also. pushpendra pushpendra @ yahoo.com