31 July 2013
Respected Sir, One of my clients has won a MHADA Lottery.I want to know whether payments made to MHADA for purchase of a residential house property qualifies for deduction under sec 80C. I referred to sec 80C(2)(xviii)(a) wherein it is stated that : Sums paid in the previous year by the assessee for the purchase of a residential property, where such payments are made towards or by way of any instalment or part payment of the amount due under any self financing or other scheme of any development authority,housing board, engaged in construction and sale of house property on ownership basis,shall be deducted in computing the total income of the assessee. Please guide me on this matter at your earliest. Regards.
02 August 2013
The act is very much clear. If you have taken any loan then if you are paying the principal or installment then it is eligible. In your case you have invested your own money at the time of filing of application for allotment of house. Hence, you are not covered by the section till you take the loan. Once you take the loan and start repayment then yes you are eligible for deduction. MAHADA is also eligible but the loan has to be taken from the Banks approved by MAHADA
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