Pankaj (service) 03 March 2008

Income Tax Purpose

Respected sir

I want to know that is the loan for renewation (House) is exempt Under IT Act.1961.

If yes,what is the procedure and documents reqired.

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8 Replies

Guest (n/a) 04 March 2008

I am new menber

Rajesh Thakker (Advocate) 04 March 2008

Dear Mr. Pankaj
If you had taken loan from the bank for renovation of your old house self occupied house, only interest amount will be deducted under the House property income as negetive figure (loss) and the said amount will be dedcut from your other income.

Guest (n/a) 05 March 2008

to collect revenue for govt

Rajesh Thakker (Advocate) 05 March 2008

Dear Mr. Pankaj As per sec. 24(b) of the Income-tax Act, 1961amount of interest paid on borrowed capital is allowable deduction under the head Income from House Property up to limit Rs. 30,000/-.

SURYAKANT (CHARTERED ACCOUNTAT) 05 March 2008

no it is not posible to claim exempt

RAJAGOPALAN (CHARTERED ACCOUNTANT) 05 March 2008

Dear Pankai, you can claim upto rs 30000 as deduction as loss from house property as interest u/s24(b). With respect to principal, you cannot claim the 80C benefit. You have to produce the usual interest certificate from the bank/Financial institution

Rajagopalan

B Bala Pullaiah (Salaried Employee) 01 January 2009

I think interest claime u/s 24(b) increase to 1.5 Lac PA & principle can be clamed exemption u/s 80C - 80 C Limit is I.00 Lac

B Bala Pullaiah

A V Vishal (Advocate) 26 January 2009

24. Income chargeable under the head Income from house property shall be computed after making the following deductions, namely:

(a) a sum equal to thirty per cent of the annual value;

(b) where the property has been acquired, constructed, repaired, renewed or reconstructed with borrowed capital, the amount of any interest payable on such capital:

Provided that in respect of property referred to in sub-section (2) of section 23, the amount of deduction shall not exceed thirty thousand rupees :

Provided further that where the property referred to in the first proviso is acquired or constructed with capital borrowed on or after the 1st day of April, 1999 and such acquisition or construction is completed ⁴[within three years from the end of the financial year in which capital was borrowed], the amount of deduction under this clause shall not exceed one lakh fifty thousand rupees.

Explanation.Where the property has been acquired or constructed with borrowed capital, the interest, if any, payable on such capital borrowed for the period prior to the previous year in which the property has been acquired or constructed, as reduced by any part thereof allowed as deduction under any other provision of this Act, shall be deducted under this clause in equal instalments for the said previous year and for each of the four immediately succeeding previous years:]

⁵[Provided also that no deduction shall be made under the second proviso unless the assessee furnishes a certificate, from the person to whom any interest is payable on the capital borrowed, specifying the amount of interest payable by the assessee for the purpose of such acquisition or construction of the property, or, conversion of the whole or any part of the capital borrowed which remains to be repaid as a new loan.

Explanation.For the purposes of this proviso, the expression new loan means the whole or any part of a loan taken by the assessee subsequent to the capital borrowed, for the purpose of repayment of such capital.]

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