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On housing loan repayment- urgent exam query

Udhins (Chartered Accountant) (113 Points)

19 October 2009

U/s.24 we have provision for claiming the "prior period interest" in 5yers .... But do we hav any provision for claiming deduction U/s80 C for those principle installments paid during the construction period after the construction is over?

Coz in a point it says "those installments paid during the construction period cannot be claimed u/s. 80C during construction period!

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13 Replies

Sumit Jain (CA) (4760 Points)
Replied 19 October 2009

yes it is right

under 80c only current year payments are allowed for deduction

Rajeev (www.rkmco.com) (985 Points)
Replied 20 October 2009

xviii) for the purposes of purchase or construction of a residential house property the income from which is chargeable to tax under the head Income from house property (or which would, if it had not been used for the assessees own residence, have been chargeable to tax under that head), where such payments are made towards or by way of.....

I dont see any completion condition given in sec 80C .....ofcourse the deduction of principal can be claimed irrespective of completion of construction .

Can u guys pls tell me where is it written that preconstruction installments cannot be claimed ?

The wordings are changed wef AY 2006-07

CA Suri Kota (Assistant Manager @ EY) (955 Points)
Replied 20 October 2009

Yea ..no where its been said that only preconstruction installments cannot be allowed......

Nikita Khandelwal (Student) (86 Points)
Replied 20 October 2009

The principal amount of loan repaid shall be allowed as deduction u/s 80C in the previous year in which it has been paid irrespective of the completion of construction of house property

Anuraag Sharma (Sr Executive Finance) (845 Points)
Replied 20 October 2009

ssection 80c only provides for deduction on payment towards housing loan principal....it is nowhere sated that construction should be completed or not

so any payment towards principal of housing loan taken is deductible u/s80c in the year in which it is paid.

ashish gupta ( student) (1922 Points)
Replied 21 October 2009

I agree with anurag

Dharmesh k. Dubey (Student) (188 Points)
Replied 21 October 2009

yes ofcourse the principal installments would be deductible u/s 80c irrespective of the construction being completed , coz the deduction is on payment of HSG Loan which is taken prior to construcution ,.