Impact of income tax

This query is : Resolved

shailja golash (Querist)
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16 February 2012 MR.A PURCHASED A PROPERTY FROM MR.B AT THE TIME OF PURCHASE PAPERS OF PROPERTY WAS NOT CLEAR SO MR.A CANNOT AVAIL THE BANK LOAN FACILITY AND HE PAID 80% OF PROPERTY VALUE BY TAKING A PERMANENT WITHDRAWAL FROM ITS PROVIDENT FUND ACCOUNT IN 2011. NOW THE PAPERS OF PROPERTY ARE CLEAR AND BANK IS READY TO GIVE LOAN AND AFTER TAKING LOAN MR.A WILL GET INCOME TAX BENEFIT AND BANK IS READY TO DISBURSE THAT 80% TO MR.A AS HE HAS ALREADY PAID THAT AMOUNT OUT OF HIS PF TO MR.B . IS THERE ANY INCOME TAX PROBLEM IF TAKES THAT 80% AMOUNT FROM BANK . PL.ADVISE

SANDEEP AGGARWAL

SANDEEP AGGARWAL (Expert)
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17 February 2012 For claiming interest benefit loan should be taken for buying the property or repayment of earlier loan taken for buying the property. Your case is not met either of any criteria. Therefore, you have to prove that current loan is used for repayment of earlier loan.

Regards,

CA Sandeep Aggarwal