allowability of interest paid on loan

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Anoop kumar Modi (Querist)
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22 February 2008
Sir I have taken the loan of Rs. 10 lakhs for investing in the shares and paid interest on such loan and at the year end i have sold such shares and have a a capital gain .i want to know whether i can claim the deduction of interest on loan.give answer with neccessary referrence to income tax act,1961

Note: I have only income from capital gains

CA Saurabh Maheshwari

CA Saurabh Maheshwari (Expert)
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22 February 2008 AS PER INCOME TAX ACT ONLY COST OF ACQUISITION ,EXPENSES OF TRANSFER ARE ALLOWABLE BUT INTEREST ON LOAN PAID FOR ACQUISITION DOES NOT FORM PART OF COST OF ACQUISITION. INTEREST PAID ON LOAN IS NOT DEDUCTABLE FROM CAPITAL GAIN