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Sec24b &80c of it act

P.K.Bhattacharyya (Student Others) (25 Points)

18 July 2015

I took House loan ( under subvention plan) of Rs. 56 Lakhs from ICICI on 30 April, 2012 . I 'm paying monthly EMI of Rs. 21265 since 1 st May 2014.The Flat possession is going to be delayed .. not before December 2017. PEMI interest has been paid ( Rs.584724 ) during FY2013-2014. Principal paid back is Rs.3575274 and interest paid is Rs. 231159 in FY 2014-15

(a) Can I claim deduction under sec. 24B in the Assessment year 2015-16 ? If not, when Can I?

(b) Can I claim deduction under scc 80C in the Assessment year 2015-16 ? If not when can I?

I'm getting conflicting answers from my tax experts. Please guide me.

. Dr.P K Bhattacharyya/ 18 July,2015

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CA.Ankur Khandelwal (Owner) (281 Points)
Replied 18 July 2015

Interest can be claimed as a deduction under Section 24 - only when you are in possession of the house.

where the property has been acquired or constructed with borrowed capital, the interest payable on such capital for the period prior to the year in which the property has been acquired shall be allowed as deduction in five equal instalments beginning from the year in which the property is acquired. Thus, the interest included in the loan instalment paid by you during the construction period shall be eligible for deduction from the year in which the flat is acquired/construction is completed.

The principal amount of the loan repaid till date shall not be available as a deduction under section 80C till the time the construction of the flat gets completed. Once the flat is completed and the possession is handed over to you, you will be eligible to claim deduction for interest paid on the loan under section 24(b) and principal amount of loan under section 80C. The total amount of deduction available under section 80C