Deduction of intrest u/s 24

As per Proviso to Sec 24., which states as :-

               Provided also that no deduction shall be made under the second proviso unless the assessee furnishes a certificate, from the person to whom any interest is payable on the capital borrowed, specifying the amount of interest payable by the assessee for the purpose of such acquisition or construction of the property, or, conversion of the whole or any part of the capital borrowed which remains to be repaid as a new loan.

                Explanation.For the purposes of this proviso, the expression new loan means the whole or any part of a loan taken by the assessee subsequent to the capital borrowed, for the purpose of repayment of such capital.

Thus, it is nowhere mentioned that you can not claim Interest paid to Personal Loan under Sec.24, It is up to the assessee to prove that the personal loan was used for construction of the house. You have to keep the following ready

01. Certificate of interest on Loan

02.Proof of construction, such as bills used for purchase of materials for construction.

All this is not necessary if you take a housing loan from a bank, It becomes the duty of the Bank to ensure that the funds released is used for construction and ITO will admit a certificate for intrest the final proof.

For the second part of your question, When deducting tax, your employer acts as the agent of Govt and has the Power and responsibilities of ITO.

Thanks for the clarifications.given . In case of intrest upto Rs30,000 ionly, i am of the view that prima facie only that proof /document can be demanded by the DDO/Employer which is specified in the Act. viz first proviso to Sec 24, 192 and CBTD Circular.

Accordingly, as per first proviso - no intrest certificate is reqd for repairs upto Rs30,000, for TDS under Sec192 and CBTD Circular , only self declaration/particulars are required to be furnished to the employer/DDO for taking into account the intrest income/loss.

Intrest certificate is required in terms of second proviso for intrest beyond s30,000 towards construction cost.

I solicit your views in the matter.

I have recd only reproduction of S/24. It seems your views have missed. Pl confirm my views ( para 2).Thanks.

1. Pl clarify if interest on borrowings other than specific housing loans like personal loans used for repairs of own house are eligible for deduction as property loss ( self occupied property) u/s 24

Can anyone please guide on following situation:

Suppose bank has provided credit facilities (Cash Credit) to a company and the said facilities are utilised for construction of a property which is let out as well as its other projects and administrative expenses. The income from let out property is reflected under Income from House property.

In such situation following complications can arise:

1) Bank may not be inclined to give a certificate specifing interest on let out property as the funds are not exclusively utilised for construction of let out property. Further bank has granted credit facilities not for any specific project but companys all projects as well.

2) Can it be worked out an interest proportionate to the let out property calculated on actual payments made from the credit facilities account and claim it in section 24 in absense of any specific certificate from bank specifying the proportionate interest amount?

Please Guide,

Thanks

Vinay

Mob: 9374610940

agrawalvinayr@gmail.com

alternate id: vinay@goyalco.com