House Rent Allowance

This query is : Resolved

Sundararajan G (Querist)
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30 January 2010 Dear Sir,

One of our employee has this case :

Mr.x has a owned house and he is claiming as self occupied and gets exemption in chapter VI for principal and interest.

At the same time he is residing in a house which is owned by his father.He pays rent to his father thru cheque,he has a valid leave and license agreement.He has provided rent receipts, paid rent thru cheque and has all valid documents.

My query is : is he eligible for both HRA and chapter VI deductions ? Can you please cite any case law for this if any. or any section reference ?

rgds,
sundar

CA Vijay Kumar Gupta

CA Vijay Kumar Gupta (Expert)
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30 January 2010 Both can be availed if the place of work is far away from the self occupied house.

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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30 January 2010 Yes.both can be claimed if the own house and employment in different places

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Murtaza I Bhagat

Murtaza I Bhagat (Expert)
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31 January 2010 agree to both experts

Sundararajan G

Sundararajan G (Querist)
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01 February 2010 Thanks for your replies. But what if both houses are in same city ?

I was not clear in the first question so againt I put it;

1. Can he claim HRA?
2. Can he claim principal repayment exemption in 80C?
3. Can he claim Interest payment in housing income?

CMA. Dinesh S Adhikari, ACMA

CMA. Dinesh S Adhikari, ACMA (Expert)
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01 February 2010 1) He can claim HRA Exemption.(Sec 10(13A)
2) Principal amount is deductable u/s 80C.
3) He can claim Interest payment in houseing income.(Sec 24)(b))

BUT, is he is claiming his own house as self-residence purpose, then he should not receive any benefit from that house(Sec 23(2)).

Regards!!!

Vishnu Saboo

Vishnu Saboo (Expert)
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13 February 2010 for availing HRA exmption U/S 10(13A), it is necessary that he is paying House rent, and he have no other house, which is declared by him for self occupied.