payment for payment of housing loan amt.

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sunil (Querist)
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13 July 2010 Dear experts

income from property sale is used for payment of housing loan (for other property loan)with intrest. Is the principle amt. is consider as a tax benfit for this transaction?

Request you to give best guideline to all experts.

Thanks
Sandeep

srikanth

srikanth (Expert)
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13 July 2010 Hi sandeep
As per section 54 LTCG arising from transfer of residential house property is exempt when one has purchased residential house property with in a period of 1 year before the date of transfer...so in ur case if the house property for which ur paying principle is purchased with in the time specified in sec 54...Then definitely amt u paid as repayment of debt is eligible for deduction...

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CA. BIJENDER KR. BANSAL

CA. BIJENDER KR. BANSAL (Expert)
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13 July 2010 AGREED WITH EXPERTS.

Under Section 54 of the Income Tax Act, 1961 any capital gain arising from the transfer of a residential house property which is a long term asset, is exempt from tax, provided that the assessee has purchased within a period of one year before the transfer (or within two years of the transfer) or has constructed a residential house property within a period of three years after the date of transfer.

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