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2011 (4) TMI 889 - AT - Income TaxInterest on loan claimed against the income from house property - Disallowance u/s 24(b) - Lease agreement of 30 years - Held that:- Though the loan was taken by the assessee from the bank for construction of first and second floor of the property but the construction of first and second floor of the property was part of the consideration for acquiring the lease hold right of the ground floor. Therefore, when the borrowed funds was used for consideration in the shape of construction, the interest paid on the borrowed funds is liable for deduction under section 24(b). The lower authorities have taken an incorrect view by holding that the borrowed funds have been utilized for construction/re-construction of the property which is not the property being let out - in favour of assessee.
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