Hello Friends,
I have a small query in PCC Taxation, in the topic Income from House Property, Pre-Construction Period Calculation. Here is the question in my book :
B purchased a piece of land, the built-up area of house was 1,000 sq ft. Ground Floor and an equal area in the first floor. B Started the construction on 1.4.2008 and completed the construction on 1.7.2009. B Occupied the ground floor on 1.7.2009 and let-out the First Floor for a rent of Rs.15,000 p.m. However, the tenant vacated the house on 31.12.2009 and B occupied the entire house during the period 1.1.2010 to 31.3.2010. B has availed a housing loan of Rs.12 Lakhs at 10% p.a on 1.7.2008. No repayment was made by him till 31.3.2010.
So in this question i've calculated current period interest as follows :
For the purpose of Self Occupied and Let out portion, i'm taking 50%.
12,00,000*10%*50% = 60,000
This is what I did but in my text book padhuka its given in this way which i didn't understand :
current period interest ------- 12,00,000*10%*50% = 60,000
prior period interest ----------- 12,00,000*10%*9/12*50%*1/5 = 9,000
I understood why we have taken 1/5 but i didn't understand why 9/12 is considered.
Please explain me pre-construction period in this case fully in detail.
Thank you..!!
CAclubindia
