section 24(b)

1. According to sec 24(b), there is no specific word mentioning it should be from a specified bank or institution for the purpose of claiming deductions on interest on borrowed capital. 
2. There were cases where the unpaid amount for the purchase of house property and interest paid on the sale were also allowed as deductions. 
3. So in your case interest on borrowed capital will surely be available as deductions u/s 24(b) subject to a maximum of Rs. 200,000. 
4. However, if the property is rented out there is no limit on deductions of interest on borrowed capital. 
5. However, a certificate must be provided to this effect from the borrower for payment of interest on borrowed capital. 
Please correct me if the above solution has an alternative view.