House construction loan interest treatment

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Querist : Anonymous

Querist : Anonymous (Querist)

20 February 2013 Hi,

At my native place a old house which is own by my father. For reconstruction of this house I take a personal loan from bank of rs. 5,00,000/- against salary for which no property was kept as security with bank.
My query is that can i claim deduction on my personal loan repayment installment including interest u/s 24(b) & principal u/s 80c.

pl solve my query & help me.

Regards,

Amit

Nikhil Kaushik

Nikhil Kaushik (Expert)

21 February 2013 Dear Amit,

Theoretically NO.

the benefit of 80C and 24(b) are restricted to the owner of the house, which in this case is your father.

Message likes : 1 times

Anand

Anand (Expert)

21 February 2013 No you will not get the benefit as rightly stated by Nikhil.
What you have taken is a personal loan which is then applied towards house property, not owned by you.

Message likes : 1 times

Querist : Anonymous

Querist : Anonymous (Querist)

21 February 2013 Mr. nikhil Sir,

Thanks for the answer.

If property is owned by me , then personal loan can be used for the benefit of sec 24(b) & sec 80 c. if yes then at the time of filing return what proof will be given for the personal loan.

Regards,

Amit

Nikhil Kaushik

Nikhil Kaushik (Expert)

21 February 2013 There is no need to submit any proof at the time of filing the Income-tax return. If and only if your case is selected for scrutiny, you shall have to provide a copy of the loan documentation as well as a proof of repayment (copy of the account statement or a certificate from your banker should suffice for the same).

Querist : Anonymous

Querist : Anonymous (Querist)

21 February 2013 Nikhil Sir,

Weather personal loan utilised for repair of house then it will qualify for the deduction from the income tax. & under sec. 24(b) what will be the maximum limit available for deduction i.e. 30000/- or 150000/-.

Nikhil Kaushik

Nikhil Kaushik (Expert)

21 February 2013 I see no reason for which personal loan can be disqualified. Atleast the language of section 80C doesn't suggest any such disqualification.

If I am not wrong, interest limit should be Rs 30,000.

Querist : Anonymous

Querist : Anonymous (Querist)

21 February 2013 Thank You Very Much

Regards,

Amit

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