Housing loan

This query is : Resolved

CA S.IBRAHIM (Querist)
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21 August 2011 House is on the name of husband and housing loan is taken by wife for construction of house, husband is not co-borrower, then who will get deduction u/s 24 and u/s 80c.

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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21 August 2011 For getting deduction both house and loan should be in the name of the assessee, even joint name also applicable

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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21 August 2011 In this situation, you can resort to a tax planning and can claim both the deductions-
S24 as well as section 80C provided the meaning of your query supports my assumptions-

House is in the name of Husband.
Construction Loan has been taken by wife.

It seems that house has already been purchased by the husband.

Now , for further, construction purpose
the wife has taken loan.

In such a situation the wife after getting a No Objection Certificate from his "Shauhar", can carry on further construction work and becomes eligible for IT benefits.

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CA. Nitin Agrawal

CA. Nitin Agrawal (Expert)
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21 August 2011 According to my understanding regarding finance. Bank/FI can't give loan without taking the house owner as co-borrower.

So please check your loan documents for the confirmation.

As far as query is concerned, what is important that "from whose income the loan is repaid, the same will get the deduction u/s 80C and exemption u/s 24"

Any correction and comments are welcome.

Regards
CA. Nitin Agrawal

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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21 August 2011 I concur with the observation of Ramesh Ji because section 24(b) is for a person to calculate "income from house property".
Husband has income from HP but no loan meaning thereby 24(b) can't be claimed.
Wife have no income to be assessed under HP(since she is not the owner) but have interest,here again 24(b) will be denied.
Same analogy applies to 80C(2)(xviii) also meaning thereby both of them will loose the benefit of deduction of the said section.