S. C. Vasudeva
Q.I, my wife, my father and my mother had taken a house building loan from a nationalised bank for constructing a house. The land on which the house was constructed is in the name of my parents. The house is in a village and not in a municipal area. The water connection, house tax is on my name. My wife and I are repaying the loan regularly to the bank. Father and mother have not repaid any money to the bank. My parents have made a Will in my favour regarding the land on which the house has been constructed.
My queries are:
A.Deduction under Section 24 of the Income Tax Act 1961 in respect of interest paid on house building loan is allowed to an owner of the house. It is possible under the Indian law that the house is owned by a person other than the person who owns the land on which the house has been constructed. In case your father and mother have permitted you to construct a house on the land owned by them, it should be possible to claim that the house is owned by you, and therefore, you are entitled to claim deduction allowable under Section 24 of the Act. It would be advisable to execute a document with regard to the permission granted to you by your parents for the construction of the house on the land owned by them.
You have stated in the query that permission has been granted to you for constructing the house and the water connection and house tax is in your name. This implies that you are the owner of the house. Your wife is, therefore, not entitled to claim the deduction for interest paid in respect of the amount borrowed for construction of the house as she is not the owner of the house.
Stamp duty on transfer of property
Q. Five members of our family have some joint land in a rural area. We want to change the ownership of this from joint to individual shares in revenue records. Kindly advise us in this regard in view of the following points:
A.It is presumed that the transfer has to take place between brothers and sisters or from father to his children. The state of Punjab now permits transfer of immovable property between blood relatives by payment of stamp duty @1 per cent of the market value. In the circumstances it would be advisable to adopt gift route for the transfer of property between the blood relations.
Share in grandfather’s property
Q.My great grandfather had been allotted a house in Patiala in lieu of his house in Pakistan through the Presidents Reallocation Scheme in 1964. He had six children (five daughters and one son). he had bequeathed the house to my grandfather through a registered Will. My grandfather had three children (two sons and one daughter). He made a registered Will in favour of my grandmother regarding this house. My grandmother made a registered Will maintaining that she would not sell the property in her lifetime and named her sons (i.e. my father and uncle) as co-owners of the house after her death. In the meantime all the legal heirs (i.e. my father, uncle, grandmother and aunt) sold a piece of house with mutual consent. After my father’s death my grandmother has refused to give us our share in the property under the influence of my uncle. After that we went to court to get our share the case is going on at the Patiala Civil Court. After that my grandmother under the pressure of my uncle changed her registered Will in favour of my uncle.
My queries are:
A.Your queries are replied hereunder:
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