Deduction u/s 24(b) of i.t.act .

interst for previous year will be 60000(500000*12%)

and interst relating to pre construction period will be 16000(500000*12%*4years/5*3)

36000 will be allowed as deduction for all 3 units

however last unit wont be taxable under this head

plzz tell me if m wrong

cheers

Unit I & II will be covered under Income from House Property and Unit III will be covered under Profits of Gains of Business or Profession

Accordingly, interest for unit I & II will be allowed as deduction interest for Unit III will be added to cost of acquisition of building u/s 43.

Computation of deduction:-

Pre-construction period (1.4.2005 to 31.3.2009) 4 years

(5,00,000 * 12%) * 4 = Rs. 2,40,000/-

Assuming the three units to be of identical area, the amount of interest allocable to each unit is Rs. 80,000/-.

Accordingly, pre-construction period interest of Unit I & II will be allowed as deduction in 5 equal instalments begining from AY 10-11.

Interest for Unit III will be added to the cost of building.

Post Construction Period

Interest for Unit I, II & III will be allowed as deduction on actual basis

Computation of Income

Income under the head House Property

Unit I (Self Occupied)

GAV                                                                           NIL

Less: Deduction u/s 24

(b) Interest on borrowed capital

Pre construction period (80,000/5)            16,000

For current year (5,00,000*12%)/3            20,000    36,000

Income                                                                                     (36,000)

Unit II (Let Out)

GAV (as calculated)                                                 XXXXX

(b) Interest on borrowed capital

Pre construction period (80,000/5)            16,000

For current year (5,00,000*12%)/3            20,000    36,000

Income                                                                                   

Income under the head PGBP

Net Profit

Less: Deduction u/s 36 (Interest)             20,000

Hope this solves your query. Do contact for any clarifications.