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House property sale and purchase

16 March 2017

Dear Members My client Purchased House in FY13-14,for 2cr and sold some other house in FY 14-15,for 1cr. he was eligible for exemption u/s54.,since he purchased house prior to 1yr of selling the existing house.now the question is purchase payments were done in EMI.,Was he eligible for interest Payments Deduction u/s 24.,And Extra Amount paid on Purchase was 90L,Any eligible exemptions for this??? Thanks in advance

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4 Replies

CA Ashish Barthwal (Practising Chartered Accountant) (104 Points)
Replied 16 March 2017

if the emi and interest belongs to house he purchased, and still in his possession and ownership. he is eligible.

neelu iz here ( ) (28 Points)
Replied 16 March 2017

Thanks CA ASHISH BARTHWAL.

The house was still under his possession only.was he eligible for both interst on housing Loan of rs 200000 and u/s 80C deduction of principal repayment of rs 1,50,000,since LTCG wil be zero now.

manoj (student) (5205 Points)
Replied 16 March 2017

ya he is elidigible

Basavaraj (B.Com FCA) (193 Points)
Replied 18 March 2017

Hi,

there are 2 things to be noted here. First,

The Capital gain on sale of old house is unclear in your question. Assuming that Rs. 1 crore is your capital gain from sale of your old house, and the purchase value of the new hous is 2 crore. the whold of Rs. 1 crore is eligible for capital gain u/s 54. Rest of the amount paid of Rs. 90 Lakhs, there is no exemption for this.

second,

The interest on borrowed capita is eligible upto Rs. 2 Lakhs if its self occoupied. If its LOP the whole of interest can be claimed as deduction in addition to the standard deduction.

Hope this clarifies your doubt