24 December 2013
Loan was taken against under-constructed property of a builder and the builder took six years to complete the project. Please advice on the below points in relation to above:- 1) whether interest of pre-constructed is allowed even if construction completion time taken by builder is of six years; 2) If the owner sold the property within five years of possession, whether the balance pre-constructed period interest is allowable or treated as non-recoverable.
28 December 2013
it depends on nature of property. if property is self occupied then deduction of interest will not be allowed but if it is let out then the same will be allowed. further if property is sold you will repay the loan hence no further interest will be there.
CAclubindia
