Deductions from income from house property.
24. Income chargeable under the head "Income from house property" shall be computed after making the following deductions, namely:—
(a) a sum equal to thirty per cent of the annual value;
(b) where the property has been acquired,
constructed, repaired, renewed or reconstructed with borrowed capital,
the amount of any interest payable on such capital:
Provided that in respect of property referred to in sub-section (2) of
section 23, the amount of deduction shall not exceed thirty thousand rupees :
Provided further that
where the property referred to in the first proviso is acquired or
constructed with capital borrowed on or after the 1st day of April, 1999
and such acquisition or construction is completed within
28[three]
years from the end of the financial year in which capital was borrowed,
the amount of deduction under this clause shall not exceed
29[two lakh rupees].
Explanation.—Where the
property has been acquired or constructed with borrowed capital, the
interest, if any, payable on such capital borrowed for the period prior
to the previous year in which the property has been acquired or
constructed, as reduced by any part thereof allowed as deduction under
any other provision of this Act, shall be deducted under this clause in
equal instalments for the said previous year and for each of the four
immediately succeeding previous years:
Provided also that no
deduction shall be made under the second proviso unless the assessee
furnishes a certificate, from the person to whom any interest is payable
on the capital borrowed, specifying the amount of interest payable by
the assessee for the purpose of such acquisition or construction of the
property, or, conversion of the whole or any part of the capital
borrowed which remains to be repaid as a new loan.
Explanation.—For the
purposes of this proviso, the expression "new loan" means the whole or
any part of a loan taken by the assessee subsequent to the capital
borrowed, for the purpose of repayment of such capital.