Sec 80EE - Whether only for acquisition or construction also implied ? - Professionals - Taxation - TIK Share

Sec 80EE - Whether only for acquisition or construction also implied ?


Rakesh Bharadwaj

2014-03-25

Hi, 

As per Sec 80EE, can we get deduction of interest for loan when the house is under construction assuming all other conditions of the section are satisfied.

Sec 80EE explicity uses the word "ACQUISITION", can we extend the section to even construction purposes for the benefit of assesee ?

Rahul Rai

2014-03-25

Section 80EE says aquisition of property and not contruction of property. Its evident from the wordings that deduction is available only for aquisition and not contruction of property.

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Rakesh Bharadwaj

2014-03-25

But was that the intention of the section ? 

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Rahul Rai

2014-03-25

Yes that seems to be the intention of section to increase the sales of flats since the real estate market was down in 2013-14.

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Rakesh Bharadwaj

2014-03-25

But many assessees are claiming even the construction is in progress? Many tax advisers are telling we can claim.

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Rahul Rai

2014-03-25

Do you have any solid reason for that or they are doing it in confusion. I can not find any explanation on that.

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Rakesh Bharadwaj

2014-03-25

Rahul 

Where does the section explicitly disallow for construction-in-progress  ?

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Rahul Rai

2014-03-25

But it does not allow also. The section says aquisition of property. Aquisition can be only of the completed property and also the deduction is not for loan amount but interest amount.

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Rakesh Bharadwaj

2014-03-25

Rahul rai. 

If you analyse the section carefully, you will notice that the Possession of the house property is not the Important event, there should be an agreement to buy a residential property, a home loan must be sanctioned on or after 01-04-2013. So i feel if you have made an agreement to buy a flat or property, even if it is under construction u can claim 

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Rahul Rai

2014-03-25

But the property should be HOUSE, house is called house only if its completed. Section says aquisition of property and not construction of property.

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Rakesh Bharadwaj

2014-03-25

Rahul rai

i think this section will have lot of litigations. Eventhough this section is just for 2 AYs, i feel it has far reaching impact on department and assessees.

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