Husband has taken a house loan from the bank. On his demise, his wife inherited this house. But she has no source of income. Her son is repaying the bank loan from his income. Will the son be entitled to claim deduction under Sec. 80C on this repayment?
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Deduction under sec 80c
Replies (2)
No, the son cannot claim deduction u/s 80c as the house has been inherited by mother not the son. Section 80c of the act says one is entitled to deduction for repayment of loan taken for construction/purchase of house, the Income from which is taxable in his hands under the head 'INCOME FROM HOUSE PROPERTY'. As the house property income is now taxable in hands of mother, the son cannot claim deduction under this section. This deduction is available to the owner of house property and not to the payer of loan. (This is my interpretation of the section. I am not sure if there is any contrary judicial pronouncement or case laws in this regard.)
Deduction is allowable only for repayment of the amount borrowed by the assessee. As the son has not borrowed the money hence he can not claim the deduction.
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