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Deduction u/s 24

rohit (Student CA Final ) (117 Points)

04 January 2016

whether interest on unsecured loan eligible u/s 24 as i observed there is words "home loan" that means loan by its naturr covered under " " and unsecured loan is a personal loan do i observe correctly

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Ankit Taprania (CA FINAL ) (542 Points)
Replied 04 January 2016

Deduction of INTREST on house loan is available under section 24 and section 24 does not prescribe any condition that the loan should be from any bank or financial institution therefore interest payment on house loan taken from individual can be claimed under section 24.

PROVIDED interest payment certificate is received from lender.

Further principal repayment of house loan is available under section 80C , and which will not be available if loan is not from bank or notified financial institution .

Therefore if house loan is taken from individual deduction of only interest payment will be available and not of principal repayment.

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rohit (Student CA Final ) (117 Points)
Replied 04 January 2016

should i mention nature of loan in agreement. what about extent of amount, practically it is 18-24 percent. further nothing contained in the act "nominal rate"

Ankit Taprania (CA FINAL ) (542 Points)
Replied 04 January 2016

As long as you have a valid loan agreement and proof of payment of EMI ( bank statment ) ensuring genuiness of the transanction , interest will not be disallowed.

not required to show nature of loan.

2. interest rate

loan from bank : whatever interest rate you are paying .

loan from individual : interest rate as per agrement but it should be genuine ( nominal).

rohit (Student CA Final ) (117 Points)
Replied 04 January 2016

ankit, nothing is contained about "nominal rate". it is basic interpretation, is it? can you please refer any case law?

sonal chugh (student) (36 Points)
Replied 04 January 2016

since 80c can't be claimed . i dont't think anyone will prefer loan from individual as a taxplanning .

ya i think nominal rate is a reasonal interpretation as nothing is mentioned .

rohit (Student CA Final ) (117 Points)
Replied 04 January 2016

sonal, i do agree about 80C in most of villeges people takes loan through unsecured sources because of spot need how can they get advantage of section 24

rohit (Student CA Final ) (117 Points)
Replied 04 January 2016

sonal, i do agree about 80C in most of villeges people takes loan through unsecured sources because of spot need how can they get advantage of section 24

rohit (Student CA Final ) (117 Points)
Replied 04 January 2016

sonal, i do agree about 80C in most of villeges people takes loan through unsecured sources because of spot need how can they get advantage of section 24

Shyam C.Pujara (Student (C.A Final)) (177 Points)
Replied 09 January 2016

Originally posted by : Ankit Taprania
	Deduction of INTREST on house loan is available under section 24 and section 24 does not prescribe any condition that the loan should be from any bank or financial institution therefore interest payment on house loan taken from individual can be claimed under section 24. PROVIDED interest payment certificate is received from lender. Further principal repayment of house loan is available under section 80C , and which will not be available if loan is not from bank or notified financial institution . Therefore if house loan is taken from individual deduction of only interest payment will be available and not of principal repayment.