The existing provisions contained in section 24 of
the Indian Income Tax Act provide that income chargeable under the head “Income
from house property” shall be computed after making certain deductions.
Clause (b) of the said section provides that where
the property is acquired with borrowed capital (Home loan), the amount of any
interest payable on such capital shall be allowed as deduction in computing the
income from house property.
The second proviso to clause (b) of the said
section, inter-alia, provides that in case of self occupied property where the
acquisition or / construction of the property is completed within three (3)
years from the end of the financial year in which the capital is borrowed, the
amount of deduction under that clause shall not exceed Rs. 1.5 lakh.
There has been appreciation in the value of house
property and accordingly cost of finance has also gone up.
Therefore, it is proposed to amend the second
proviso to clause (b) of said section 24, so as to increase the limit of
deduction on account of interest in respect of property referred to in
sub-section (2) of section 23 to Rs. 2 lakh rupees.
This amendment will take effect from 1st April,
2015 and will, accordingly, apply in relation to the assessment year 2015-16
and subsequent assessment years.
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