Krishna (Advocate) (88 Points)
25 November 2009Mr. A has a housing loan of Rs. 30,00,000.00 for which he is paying interest Rs.2,50,000.00. He is debiting that interest in house property account and also claiming dedction of Rs.1,50,000.00 u/s 24. My querry is while selling the property, the interest debited in property account will get indexation, and is it amount to cost of improvement ?
Krishna
(Advocate)
(88 Points)
Replied 25 November 2009
| Originally posted by :Murali | ||
| " | Mr. A has a housing loan of Rs. 30,00,000.00 for which he is paying interest Rs.2,50,000.00. He is debiting that interest in house property account and also claiming dedction of Rs.1,50,000.00 u/s 24. My querry is while selling the property, the interest debited in property account will get indexation, and is it amount to cost of improvement ? | " |
P-A-W-A-N
(TAX - MANAGER AT GURGAON)
(541 Points)
Replied 26 November 2009
YEs It is revenue expense if you take benfite of sec 24 then u also take benefit as cost of improvment this ia not valid planning my dear
Pawan Kumar
(audit manager)
(118 Points)
Replied 26 November 2009
yes
it is revenue expenditure. hence cant take that benefit this may be called duoble deduction
Krishna
(Advocate)
(88 Points)
Replied 26 November 2009
There is a similar propeblem discussed in Taxmann's Direct Taxes Law & Practice, under "Propblems on Computation of Capital Gains, So it seems clear that the indexation is possible, I want to know interest u/s 24 is possible or not, because the limit u/s 24 is Rs.1,50,000.00only
Lalit aggarwal
(.)
(371 Points)
Replied 26 November 2009
yes dear it is very much possible to claim deduction of Rs. 150000 u/s 24 as there is no pre condition regarding the claim of indexation,nd also u can claim the indexation benefits on the same as there is no pre condition of claiming of deduction u/s24.(It is only possible when it is of the nature of capital i.e. intt. of pre-construction period.
Vinodh Kothari
(Chartered Accountant)
(25 Points)
Replied 26 November 2009
Indexation on Interest debited to property account cannot be claimed as it does not amount to improvement
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