11 September 2009
Case:ABC are joint owners of Property 1 and DE are joint owners of Property 2 Property 2 is constructed by Mortgaging of Property1 and CD are claiming interest under sec.24b Now Property 3 and a Guest House is purchased in the name of C by mortgaging Property 2.
1)whether C can claim interest on housing loan u/s.24(b) for the property 3 if yes will it apply proportionately?
2)Is it necessary that the source for the repayment of EMI should be generated from the C?
Can any one explain the taxation issues over this?
12 September 2009
The basic thing for computation of House property is that the assesse should be the owner of the property. Also in the case of joint ownership proportionately they can claim. The nexus should be established for claiming the interest paid so that the loan availed shold be in the name of assesse. So the security is not a matter. in the present case C& D are claiming interest for Property 2, but C in not one of the joint owner.So it is not correct. But C is the owner of P 3, and loan is taken by him interest can be claimed. For the sake the person claiming interest loss under Sec24 shall ensure his source.
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