Section 24-Deduction of intrest on borrowed capital
(Querist) 06 December 2008
This query is : Resolved
pl clarify (i)As per Sec 24 of IT Act, intrest on borrowings for housing repairs are allowed to be deducted as loss from property and allowed to be taken into account by the DDO / employer for TDS .Ifeelintrest on personalloan - and not only int on housing loans - for repairs of self occupied house is allowed by the DDO/ employer. . Pl quote any clarifications given by CBDT/Courts. (ii) Whether DDO/Employer can demand rent receipts for rents upto Rs 3000/- as allowed by the CBTD Circulars pl clarify. Pl quote any clarifications given by CBDT/Courts.
S K R P GUPTA
(Expert) 11 February 2009
sir 1. Deduction u/s. 24(b)of Income Tax Act, 1961, intt. loan on account of repairs to house property is eligible upto Rs. 30,000 further no such provision of intt. on personal loan. The DDO/Employer has to consider the such portion of Interest while deducting the TDS.
2. as per Circular No. 11 of 2006 dated 16/11/2006, The disbursing authorities should satisfy themselves in this regard by insisting on production of evidence of actual payment of rent before excluding the House Rent Allowance or any portion thereof from the total income of the employee. Though incurring actual expenditure on payment of rent is a pre-requisite for claiming deduction under section 10(13A), it has been decided as an administrative measure that salaried employees drawing house rent allowance upto Rs. 3,000 per month will be exempted from production of rent receipt. It may, however, be noted that this concession is only for the purpose of tax-deduction at source, and, in the regular assessment of the employee, the Assessing Officer will be free to make such enquiry as he deems fit for the purpose of satisfying himself that the employee has incurred actual expenditure on payment of rent. i think it solve the querry. regards