02 February 2011
My friend has recently taken a Home Loan from SBI. SBI has also sold him a term life insurance policy (SBILife Smart Shield). The premium of Rs. 96000- was also financed by SBI and paid directly to SBILife by debiting the Home Loan Account. Will this amount paid be allowed as deduction for FY 2010-11 Us 80C since the amount was not paid from his income chargeable to tax but was directly paid by the Bank.
02 February 2011
Section 80C has been reintroduced by the Finance Act,2006 in which the condition of premium payment out of current years income is missing ( earlier section 80C and section 88 have that condition) meaning thereby your friend will get deduction under the said section provided the other conditions in the section are satisfied.
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