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CS Executive · Tax Laws and Practice · Income under the Head House Property

Mr. Vikram Nair has two self-occupied houses treated under section 21(6). For House A the interest on a loan for acquisition (completed within five years, with lender's certificate) is Rs. 1,60,000. For House B the interest on a loan for repairs is Rs. 50,000. Under section 22(2) and (5) of the Income-tax Act, 2025, what total interest deduction is allowed?

The allowed deduction is Rs. 1,90,000. House A's interest of Rs. 1,60,000 is within its Rs. 2,00,000 limit, House B's repair-loan interest is restricted to Rs. 30,000, and the total stays within the aggregate limit of Rs. 2,00,000.

  1. ARs. 2,00,000Correct
  2. BRs. 2,10,000
  3. CRs. 1,90,000
  4. DRs. 2,30,000

Explanation

House A is capped at Rs. 2,00,000 so its Rs. 1,60,000 is within the limit. House B, a repair loan, is capped at Rs. 30,000 under the 'any other case' limit, giving Rs. 30,000. Sum = 1,90,000, which is below the aggregate cap of Rs. 2,00,000 in section 22(5). Hence Rs. 1,90,000 is allowed; Rs. 2,10,000 wrongly adds the uncapped Rs. 50,000 sum without limits.

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