House rent allowance

This query is : Resolved

P.C. Joshi (Querist)
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12 May 2016 Dear Friends,

Please share your views on the following query.

A is an employee of a pvt. firm in Delhi. he has own house in Delhi which is very small and not in sufficient to his requirement and location hence, given on rent and he is declaring the income of house in his ITR.

His wife also owns a house in Delhi where they are living. A pays monthly rent to his wife, who files ITR disclosing house property income.

Is the above arrangement legally valid.Please share your thoughts.

Thanks

P.C. Joshi

Murtaza I Bhagat

Murtaza I Bhagat (Expert)
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12 May 2016 HRA will be claim by a person who has not any self occupied house property whether small or big in near by area of your company. If you and your wife are showing HP income in your ITR which is right. but for your HRA deduction in my view you can't claim deduction as per 10 (13A).

Murtaza I Bhagat

Murtaza I Bhagat (Expert)
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12 May 2016 In my view if you don't have house property and if you stay in your wife property then only you can claim HRA deduction.

Amol S Joglekar

Amol S Joglekar (Expert)
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12 May 2016 You can claim the same, no issues. Paying rent to wife is tenable at law.

P.C. Joshi

P.C. Joshi (Querist)
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12 May 2016 But Sec. 10(13A) or Rule 2A nowhere puts this condition that the employee should not own any house in his place of working. It says exemption is denied where an employee lives in his own house, or in a house for which he does not pay rent.

Amol S Joglekar

Amol S Joglekar (Expert)
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12 May 2016 Absolutely correct P C Joshi......that is why i said....you can claim the same.....your claim is tenable

Murtaza I Bhagat

Murtaza I Bhagat (Expert)
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12 May 2016 Right Joshi Sir, It was the only reason why I have not said about taking exemption of HRA.

P.C. Joshi

P.C. Joshi (Querist)
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12 May 2016 Thank you all for your valued inputs. Shall welcome more views.

Amol S Joglekar

Amol S Joglekar (Expert)
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12 May 2016 you are most welcome