20 February 2009
If an assessee bought 2 houses & borrowed two different loans. If he fulfills all the conditions laid down u/s 24b for claiming deduction upto Rs.150000/-, how much deductions shall be allowed to him for FY against Interest on borrowed loan? (Rs.150000/- or Rs.300000/-)
20 February 2009
It depends on house is being self occupied or given on rent. For self occupied house the limit is Rs.150000/- and for house given on rent he can claim full deduction.
To the contrary if he is occupying both the houses, then he is elibible for only 150000 put together for both the loans.
20 February 2009
http://www.taxworry.com/2007/08/can-you-claim-deduction-on-home-loan.html. Pl read an identical issue hosted in the site given herein.
21 February 2009
"Where the person occupied more than one house for his own residential purpose, only one house (according to his own choice)is treated as self-occupied and all other houses will be "deemed to be let out" (Source: Para 40 of 31st edition of Singhania's Direct Taxes Ready Reckoner)
So if the assessee has obtained loans for two houses, he will be entitled to treat only one as self-occupied and claim interest for such house upto Rs 150,000.
For the second house, he should return rental income for which he may perhaps adopt municpal valuation for property tax assessment and claim interest for the second house to the full extent
This view is on the assumption that he is not owning any other house (except the two under question) or not claiming HRA benefit for any house taken by him on rent for self-residence
CAclubindia
