As per the provisions of section 80C, principal repayment of borrowed amount for the purposes of purchase or construction of a residential house property from the notified authority is eligible for deduction, if such house property is chargeable to tax under the head "Income from house property" (including assessee's own occupation of the house property).
Since under construction house property does not qualify to be chargeable to tax under the head "Income from house property", no deduction shall be allowed u/s 80C.
Section 80C is an Income Tax saving section that has been introduced by the Finance Act, 2005. Broadly speaking, this section provides a deduction from total income in respect of various investments/ expenditures/payments in respect of which tax rebate u/s 88 was earlier available.
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