House Property Income

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bala (Querist)
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14 July 2008 I have got allotment of a flat in a House Building Co-operative Society.I havn't got the possession as yet .Can I claim the amount paid as instalment to the society as deduction u/s 80C. What if the sum paid before allotment. Can anyone quote the facts of any decided case law in this respect?

CA RAMESH KUMAR AHUJA

CA RAMESH KUMAR AHUJA (Expert)
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14 July 2008 Repayment of Principal Amount is deductible u/s 80C upto the max limit of Rs. 100000/-. Also, the interest paid on House Loan prior to construction or possession shall be accumulated and 1/5th of this and balance in equal instalments in the next 4 succeeding years will be claimed as deduction u/s 24 alongwith the intt for the year itself.

bala

bala (Querist)
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15 July 2008 What if we have no bifurcation of interest & principal amount in the instalment due ? Can we claim the instalment paid as a deductible amount u/s 80C before being given the possession of the flat?

CA RAMESH KUMAR AHUJA

CA RAMESH KUMAR AHUJA (Expert)
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15 July 2008 No, Intt is deductible under section 24 while Repayment is deductible u/s 80C seperately. The breakup of payments into principal and interest is necessary. A certficate is issued by every H.Loan provider for Income Tax purpose which gives the requisite break up. Also, the Assessing Officer may ask for such a certificate to verify the authenticity of claims of deductions under both the sections. As such it is always advisable that such a certificate should be obtained.

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