Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2017 (8) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2017 (8) TMI 1662 - AT - Income TaxIncome from house property - Disallowance on account of interest expenditure paid by the assessee u/s. 24B - subsequent loan to repay earlier / original loan - repayment of housing loan is out of fresh borrowings - whether interest on subsequent loan taken for repayment of housing loan was eligible for deduction u/s. 24 of IT Act against the income from housing property? - HELD THAT:- Interest on subsequent loan to repay the earlier housing loan is also allowable subject to the following conditions: A. the assessee has to establish that the subsequent loan is to repay the earlier housing loan B. deduction on interest is allowable only to the extent of interest on earlier loan used for acquiring or constructing the housing property and not on the unpaid interest on such earlier housing loan or subsequent housing loan to repay the earlier housing loan. We set aside the order of CIT(A) for all the 5 years and restore the matter to the file of the CIT(A) for fresh decision with the direction that he should examine the claim of the assessee in line with above discussion and deduction on account of interest should be allowed to the extent the assessee is able to establish that the subsequent loan on which interest is being claimed is used for the purpose of repayment of earlier housing loan and such claim of interest should be restricted to the extent of actual amount of earlier/new housing loan used for acquiring / constructing housing property and it should not be for unpaid interest. The ld. CIT(A) should pass necessary order as per law as per above discussion after providing adequate opportunity of hearing to the assessee- Appeals filed by the assessee are allowed for statistical purposes.
|