environmental clearances
Moving swiftly to boost housing supply

The National Real Estate Development Council (NAREDCO) has welcomed the Ministry of Environment & Forests’s move to give guidelines for speedy approvals of the projects submitted for environment clearance.

The guidelines will ensure that the projects are cleared by both State Environment Impact Assessment Authority (SEIAA) and State Expert Appraisal Committee (SEAC) within six months of submission of all relevant documents as against 1-2 years required currently.

As many as 1,000 proposals are pending for such clearances with various environment departments/committees across India at present. This has choked the supply substantially.

All real estate projects over 20,000 sq. m need environment clearance and usually the process involves clearances by two bodies — State Environment Impact Assessment Authority (SEIAA) and State Expert Appraisal Committee (SEAC) — wherein the basic parameters of the stipulated guidelines are fixed for the approval process.

NAREDCO, together with many developers, had approached the government, to initiate steps that can shorten the duration for environmental approvals for speedy project clearance. The body had pointed out that since the approvals of projects is handled by the respective Building Proposal Departments, i.e. their respective ‘Wards’, the approval criteria with respect to local bylaws should be governed by the local approving authorities. The projects can then be whetted by Environmental Clearance Committee on environmental hazards, etc.

Speaking on the guidelines issued by the Ministry of Environment & Forests Sunil Mantri, Vice-President NAREDCO said, “We welcome the move, as this will ensure that many projects that have been stuck due to clearance approvals will now be able to see the light of the day”.

With the recent Notification only pertinent information will be sought while issuing clearances by both the committees and clearance of the project will be carried out in a time-bound manner. Once SEAC gives its approval and recommends to SEIAA the application will be disposed off within 45 days.

“NAREDCO is hoping that the environment clearance will be issued by both the authorities, within a time span of 60 days and 45 days respectively, thus reducing the time frame to within six months, which presently takes 1-2 years”.

The body has also urged the ministry to reduce the timeframe for clearance to 30 days from present 45 days. This would ensure that projects are cleared within three months from both the committees and aid in the creating better supply in the housing sector. — TNS

Will a weak rupee bring
NRIs to realty mart?

While rupee depreciation has sent shivers down the financial spine of India, the realty sector seems to be clinging on to the very thin ray of hope of a revival that the investment by NRIs is holding out. Though NRIs form a very small segment of buyers in the country, yet in the current wave of low sales and inventory overhang their interest in properties in India is like a booster shot for the sector. Developers across the board are upbeat about this. “The depreciation of rupee has made India an attractive destination for NRI investors especially in the real estate sector. The real estate prices have been escalating in the past few years at a rate of almost 40 per cent and are not likely to fall in the near future. This is, therefore, the best time for NRIs to park their money in India by investing in real estate. They are at much more advantage in investing here than in any other country for instance in the Middle East. For those who have already invested and are paying mortgage, this would be the best time to close those mortgages with the dollar fetching them more rupees”, says Ravi Saund, COO, CHD Developers Ltd. Commenting in the same tone Pradeep Jain, Chairman, Parsvnath Group said, “The sharp depreciation in rupee value in comparison to dollar, pound and other global currencies in the past one year has rejuvenated Indian real estate market that saw a fall in global demand after the economic crisis of 2008. Enquiries from NRIs have increased in the past four months despite high property prices. However, the fall in rupee value is just a catalyst for the revival of NRIs interest. The main reason is NRIs’ desire of securing their future by buying a property in India which has seen a 42 per cent jump in prices in the past four years”. “For many NRIs, buying a property in India (either for self-occupation or for parents or siblings) remains a popular investment option. The momentum however, may get a temporary boost depending upon the rupee’s equation vis-a-vis the dollar. However, like any other price factor, after the initial euphoria things settle down as reality sinks in and is accepted. Over the sustained long term the demand from NRIs will settle down at the normal levels eventually,” says Pankaj Bansal, Director, M3M India Some developers are even taking a cue from this situation and are coming up with products primarily targeted at the NRI segment. Like the CHD group is coming up with high-end studio apartments in its upcoming commercial tower CHD Sky One. “This will majorly be targeted at our NRI customers. Gurgaon has emerged to be one of the most lucrative investment options for NRIs since it ensures a good return on investment. The areas which have witnessed more preference by the NRI segment are Golf Course Extension, Sohna Road and the upcoming Dwarka Expressway”, adds Saund. Increase in enquiries received by Wave Infratech for its new mixed-use development Wave City Center in Noida from NRIs has encouraged the brand to launch a new product in order to cater to the rising needs and demand, R K Jain, Executive Director, WAVE Infratech. “If the rupee maintains its current levels, real estate developers could see more NRI investments during the period. On the downside, the cost of construction may go up marginally as we will have to pay more in rupees in order to procure raw materials,” adds Saund. — Geetu Vaid

Doaba NRIs in a cautious mood
Varinder Singh

The constantly falling Indian rupee and the un-precedented upsurge of the mighty dollar has failed to rev up any hopes of revival of the already sulking Punjab real estate scenario.

It is, however, a different matter that it is a cheerful time for NRIs who want to invest in property as the purchasing capacity of their dollar has suddenly increased opening dollars can buy more owing to slipping of rupee with each passing day.

The NRIs who, had invested their money in the property for a long time have put the proposed sale of their properties on hold as they are not likely to get the desired appreciation. The dollar has registered a neat over 40 per cent jump in a short period of less than two years. The wide-spectrum dollar shine has turned so powerful that on an average, the currency clocked a sharp rise of about 14 per cent in the past two months.

“Even those NRIs who, were eager to sell their properties till six months ago, are reluctant now as they will get far lesser money at the current rates. It is a complete reversal of trend in Punjab. At the height of the global economic downturn till about a year back, most of NRIs were eager to sell their properties in Punjab to get the hard cash to be able to clear their debts. But now things have changed. They are not interested in selling at all. Rather, they want to acquire lands here now,” said Rakesh Sabharwal, a prominent realtor of Jalandhar.

The dollar upheaval notwithstanding, situation remains gloomy as far as the local Punjab real estate market is concerned primarily due to number of factors including, high cost of land and alleged “adverse” policies of the state government.

“Though NRIs do effect realty market in the state, yet till now the increased purchase value of the dollar has had no visible impact in Punjab. There are hardly any buyers in the market due to heavy tax regime. There are even no enquiries. No doubt, the new policy of the state government to regularise illegal colonies is a good move but, the proposed heavy development charges of ~15 lakh per acre has deeply discouraged the developers. They would not be able to pay such a heavy amount. and once again, the burden will be transferred to the common man,” said Harmol Singh, a Jalandhar-based real estate developer.

The dollar upsurge, trade insiders revealed, has only pushed up the apprehensions of people in general and of the investors in particular. “People are not coming out in the open to invest in the real estate due to the unstable economic conditions.

“Even NRIs in the Doaba region are reluctant to make big-ticket purchases as they feel that the appreciation of real estate is not going to be substantial in the state. So, they have started resorting to conventional methods like bank FDs,” says Ashwani Kohli, a Phagwara-based industrialist and real estate observer.

He, however, has hopes that the real estate market in Punjab might gain its lost sheen in November and December which is the peak NRI season in India.

“As now they know that their dollar can buy much more as compared to two years back, they would definitely be showing a keen interest in the coming months. Both, buyers and sellers need not lose heart so soon,” observed Kohli extending his advice that those who have been holding their properties for long should clear their inventories even if they have to compromise a bit. “People ‘armed’ with dollars have acquired a new power after remaining low for some years. So, they would definitely invest in North India sooner or later,” adds Kohli.

Ground Realty
Make a tile statement
Jagvir Goyal.

The Provision of tile cladding in some portions of the front elevation of the house is considered essential as well as trendy these days. A house without tile cladding looks unimpressive and incomplete. Let us therefore, have a look at the various aspects to be kept in view while choosing tiles for cladding certain portions of the walls of your house:

Trend meter: Tiles used in wall cladding are either burnt-clay tiles, ceramic tiles (produced specifically for wall cladding purpose), laminated wood tiles or stone tiles. Among these, burnt clay tiles are used more frequently. Ceramic tiles come next on the preference list. Though people have a liking for wood finish materials these days, the high cost of laminated wood tiles prevents many from choosing the same. The use of stone tiles is not that common these daysfacing a downtrend these days.

Burnt-clay tiles

These look most beautiful on walls. Indians have an inbuilt tendency to choose brick like products. That's why burnt-clay tiles are the most preferred. Their natural look and good thermal insulation property also attract Indians to use them for wall cladding. These tiles are different from the ones used in tile terracing of the house. While the tiles used for tile terracing are 40 mm thick, burnt-clay tiles for wall cladding are just 20 mm thick.

Size matters: Reputed manufacturers produce burnt clay tiles for wall cladding in multiple sizes. The most common size is 230 mm length, 40 mm width and 20 mm thickness. Smaller than this size and very popular these days are thinner tiles having dimensions of 150 mm length, 25 mm width and 20 mm thickness. Smaller is the size, more beautiful the tiles look.

Colour code: Burnt-clay tiles come in many colours. Terracotta, brown antique, red colour, chocolate brown and antique red are mainly used. Terracotta red and chocolate brown are the most preferred colours. All burnt-clay tiles in a lot don't have a uniform colour as clay is a natural product and slight colour variation in it on burning is obvious. This slight variation in colour within a lot lends the tiles a natural look making them aesthetically look better than other tiles.

Thickness: Burnt-clay tiles for wall cladding have a uniform thickness of 20 mm. The length or breadth of tiles may vary but thickness remains the same i.e. 20 mm. Burnt clay tiles are mechanically produced to have very fine edges, shape and uniform thickness so that no problem arises during their affixing on the walls.

What to look for: Burnt-clay tiles should always be checked for having zero efflorescence property. Their water absorption should be very low. The tiles should be well burnt, having high compressive strength and producing sharp and loud ringing sound on striking. Often these tiles develop slight curvature due to shrinkage of clay during burning. Such tiles should be sorted out of the lot as these cause problems in their affixing on the wall surfaces. Only straight tiles should be selected.

Cost: Burnt-clay tiles are quite costly these days. The cost varies with the colour of the tiles. While the red coloured tiles cost about Rs 8 per piece, brown coloured tiles cost Rs 8.50 per tile. Chocolate brown coloured tiles are the costliest. Taking the area of a tile as 230 mm by 40 mm, the cost of red color tiles comes out as Rs 80 per sq. ft. Adding the cost of labour for providing these tiles in the face work, the cost of tile work is Rs 110 per sq. ft. The cost multiplies if sleeker tiles are used. For tiles of size 150 mm by 25 mm, the cost comes out as Rs 160 per sq ft and cost of tile work comes out to be Rs 200 per sq. ft.

Wall surface preparation: Those portions of the wall surface where tile cladding is planned to be provided should be left with a rough finish while carrying out the plastering work in the house. The surfaces to be painted should be finished smooth. Surfaces to be clad with tiles are made rough by applying wire brush all over the plaster of the surface. This allows good adhesion during tile cladding work.

Order in advance: Good quality burnt-clay tiles are much in demand these days and are often not available in stock. The manufacturers ask for two to three weeks time for production and supply of tiles whenever an order is placed upon them. One should, therefore, decide the quantity, colour and size of tiles and place the order well in advance. On supply, the tiles should be safely stored till the gang for fixing them arrives at site. Some extra quantity should always be purchased as the colour for different lots burnt in the kiln varies and shortage of tiles at site may cause a problem.

Header tiles: Nowadays circular features or curves are being chosen more in front elevation of houses. These curves look more beautiful when finished with burnt clay tile cladding. Sharper the curves, the smaller is the length of tiles to be fixed on it. Normal tiles having length of 230 mm are not suitable for curved surfaces. Tiles having a length of 150 mm may suit some curves having large radius. Tile manufacturers now produce header tiles having just 115 mm length. These tiles are often found suitable for the curved surfaces though the work involved in affixing these increases and more labour charges have to be paid for the work. Extraordinary workmanship is required to bring out the best effect.

— This column is published fortnightly

Ceramic tiles Ceramic tiles specifically produced for outer wall cladding are also popular these days. A good variety in them is available. However, wood finish tiles are the most preferred. Their main advantage is that these look like wood but are actually in ceramic and thus are cheaper. There is no risk of their damage during rains too. These tiles cost around Rs 80 to Rs 120 per sq ft. Commonly chosen size is 600 mm by 300 mm. Tiles having a size of 600 mm by 150 mm are also produced and look more beautiful. Among the finishes, oak finish tiles, both in light and dark shades and in matt finish look most elegant. Main properties: Ceramic tiles produced by the manufacturers belong to Group II, III, IV and V. Higher the group, the stronger are the tiles. However, these are also costlier. For exterior wall cladding, one should choose group IV tiles. It should be seen that tiles are matt finished as gloss finish in exteriors doesn't look good. Scratch resistance property should also be checked. Tiles should belong to first grade as second grade lots have some curvature in edges and surface flatness is not perfect. Ceramic tiles weigh around 1.8 kg per sq ft.

guest column
Time to plan parking areas

Sanyam Dudeja COO Punjab, Taneja Developer & Infrastructures Ltd.

Provision for ample parking space has emerged as one of the major challenges for urban palnners as well as builders. The challenge is much greater in the tricity as it has the distinction of having the highest number of vehicles per capita and is severely short of parking space. Internal roads, parking slots and open parking areas in buildings and even open spaces now remain clogged with vehicles. Even though Chandigarh falls in the category of class III cities in terms of population, it is among the richest cities of Asia with a high per capita income.

It has 4.4 lakh vehicles per 1,000 km, which is almost twice as much in Delhi, where the number is 2.4 lakh. Further, the city has 878 vehicles per 1,000 persons as compared to 362 in Delhi. Such high vehicle density in the city is creating problems like the lack of parking space and air pollution among other things. In 1991, Chandigarh had over 2.58 lakh vehicles registered. That figure has crossed the 8-lakh mark now.

In Chandigarh 73 per cent of travel is through personal vehicles. The increased vehicle concentration has increased the need for concepts like multi-level and stilt parking systems.

These concepts have been adopted and have solved the parking problem to some extent in new projects.

Nowadays every township and residential complex is opting for stilt parking or else you can see rows of parking lanes outside the houses. People are ready to pay extra parking fee, while purchasing land to avoid parking woes later. Built-up apartments, flats, residential complexes also charge money for parking of vehicles which is included in the apartment cost. Stilt, open and basement are the common parking solutions provided.

Punjab government has tried to tackle this issue effectively by adding new clauses in the state’s new housing policy which is likely to be notified shortly. The proposed norms for group housing projects are:

* 1.5 ECS (Equivalent car space) per DU with unit area up to 1,200 sq. ft; 2.0 ECS per DU with unit area between 1,200 and 3,000 sq. ft and 3 ECS for units above 3,000 sq ft area.

* Additional 10 per cent guest parking shall also be provided.

* Separate multi-level parking block maximum up-to 20 per cent of the plot area is permissible and such area shall not be counted towards FAR.

* In case parking is provided under stilts, it shall not be counted towards FAR and height.

For the provision of car parking spaces, the space standards shall be as under or as amended from time to time:

* For open parking 23 sq m per equivalent car space.

* For ground floor covered parking 28 sq m per equivalent car spaces.

* For basement 32 sq m per equivalent car space.

The proposed housing policy will definitely give some relief to tackle the parking problem in cities like Ludhiana, Amritsar and Mohali.

Soon the time is approaching for multi-level parking and stacked parking (mechanical) in residential complexes also like in metros. But this is ghoing to add more zeroes to the cost of an flat/apartment.

The new projects in tricity will definitely be planned with underground parking and multi-level parking. With rapid urbanisation and infrastructural growth there is no denying the fact that over the next few years hydraulic parking systems or stacked parking will be the only option left in the residential complexes like in big commercial complexes. 

market pulse
Office space supply on a high 

The prime office space segment across key cities in India witnessed a supply infusion of more than 20 million sq ft in the first six months of 2013. According to the findings of CBRE’s latest report, India Office Market View Q2 2013, supply of prime office space across key cities in India witnessed a 16 per cent increase year-on-year and an 8 per cent increase on a quarter-on-quarter basis. Around 10.8 million sq ft of new supply entered the market in Q2 2013; while Q1 2013 witnessed around 9.9 m sq. ft. of fresh supply addition. This supply was primarily from large commercial and SEZ developments which were completed in leading markets such as Bangalore, Mumbai, NCR (National Capital Region) and Pune. Approximately 7 m sq. ft. of space was absorbed in this quarter as against 6.6 m sq. ft. in the previous quarter.

However, downward pressures continued to persist as absorption was down by about 6 per cent when compared to the same period last year. The first half of 2013 witnessed a total of about 14 m sq. ft. of space getting absorbed across all leading cities. Transaction activity in Q2 2013 was dominated by NCR, Mumbai, Bangalore and Pune representing about 88 per cent of the total transacted space during the quarter. Occupier focus continued to be on consolidation and more efficient use of their existing portfolio. Although well positioned assets continued to attract occupier interest, transactions continued to take much longer to conclude. Commenting on the findings of the report, Anshuman Magazine, Chairman and Managing Director of CBRE, South Asia Pvt. Ltd, said, “Despite a large supply infusion into the market, the prevailing global economic outlook continues to play a big part in expansion plans for corporates across the board. Cost reduction continues to be a primary concern and the overall mood in the leasing market remains cautious. I expect this sentiment to continue till the global as well as Indian economic situation improves.”

Supply pressures continued to dictate rental movement with a clear segregation of micro markets in terms of rental behaviour across leading cities. Rents were either stable or appreciated marginally in demand driven micro-markets such as Connaught Place, Gurgaon, Bandra Kurla Complex, Lower Parel and Outer Ring Road. Rental sentiments in supply driven micro-markets such as Thane, Navi Mumbai, Powai and Vikhroli were on a downward trajectory.

realty bites
Trump’s first Indian project in Pune

America’s real estate business tycoon and celebrity Donald Trump has announced his company’s first Indian project, a 22-storeyed residential twin towers in Pune having 44 luxurious single-floor condominiums. “Trump Organisation’s first project in India, Trump Towers Pune, will epitomise inspired living and timeless elegance,” Donald Trump, said on the micro blogging website Twitter earlier this week to announce his entry into India’s booking real estate market.

As the first Trump project in India, Trump Towers Pune is a blend of modern architecture, cultural richness and an oasis of elite comfort, it added. The cost of each condominium has not been announced yet. Expected to be completed by 2015, Trump Towers Pune will also have an exclusive fitness center by Bollywood star John Abraham.

“All residences will have five bedrooms with an additional home theatre room and host a 360-degree view of Pune cityscape with the surrounding Aga Khan Palace and the lush green Jogger’s Park being prominent.

GolfLinks phase II in Ghaziabad

Landcraft, an arm of the Garg Group, has launched the Phase II of GolfLinks comprising 1,100 luxurious 2,3, and 4 BHK apartments. The new phase will comprise six towers in ground plus 25 storey units. GolfLinks is a 92-acre township project at NH 24, Ghaziabad. As many as 30 families are already living in the first phase residential units. The units in the new phase are priced at ~ 2750 per sq ft. and are available in 1135 sq ft to 2375 sq ft.area.

GRIHA certification for Hindware tiles

Hindware tiles from the house of HSIL Limited, has been awarded GRIHA (Green Rating for Integrated Habitat Assessment) certification. It is a first, in the tiles category in the market.

GRIHA is a green building evaluation system that has been conceived by TERI and developed jointly with the Ministry of New and Renewable Energy, Government of India. It is a rating tool that helps people assess the performance of their building against certain nationally acceptable benchmarks by evaluating the environmental performance of a building holistically over its entire life cycle, thereby providing a definitive standard for what constitutes a ‘green building’.

GRIHA has included Hindware’s Portinari range made in Brazil and Europe, the Lavigare range (digital), Multi-charge range, Stain Free Soluble Salt range, TechGranit Full Body Vitrified tiles, Exterio range and HD Digital Ceramic Wall range under the GRIHA Criterion 17 and SVAGRIHA Criterion 12. These products can be used in the GRIHA and SVAGRIHA registered projects as they meet the GRIHA and SVAGRIHA norms as well by consumers adopting a green cause.

— Based on information provided by the developers

tax tips
Can I claim LTCG exemption?
S. C. Vasudeva 
email your queries to realestate@tribunemail.com ...

Q. In continuation to my query published in The Real Estate (dated June 8, 2013) if I choose to buy an under-construction flat which as per builder’s original plan itself is to be completed after four years from the date accruing the LTCG (case involves no delay on the part of the builder but flats are to be offered for possession after the three -year mandatory period for obtaining deduction) but 100 per cent payment is released within three years (i.e. capital gain is so utilised within three years). Will the deduction be available? If so, then please give reference of some decided cases in this regard. — R.K.Gupta

A. In the reply published on June 8, 2013, in the case cited by me, it had been held that in case the assessee had invested the capital gains in the construction of a new residential house within a period of three years, it should be treated as sufficient compliance of the provisions of Section 54. It was also held in the said decision that it was not necessary that the possession of the flat should also be taken within the period of three years. For the purpose, the Hon’ble ITAT relied on the decision of the Bombay High Court in the case of CIT v. Mrs. Hilla J. B. Wadia, (216 ITR 376).

The above finding of the ITAT gives an indication that it is the utilisation of the capital gain or net consideration as the case may be, within the period of three years which is important. The decision of High Court relied by the ITAT is also on similar lines. In view of the said decision if you have utilised the entire amount of capital gain within three years after the sale of the capital asset, then you should be entitled to the benefit under Section 54 in case you hold a valid allotment letter in respect of the residential flat purchased by you.

Cost of acquisition for computing capital gain

Q. My wife and I, on March 22, 2010, booked a flat with a builder on a two-year construction linked payment plan and paid Rs 4 lakh as the booking amount. On April 1, 2010, we made an advance payment of Rs 19 lakh to the builder for which we received an early payment rebate at 11 per cent per annum. On March 12, 2012 and January 1, 2013, we made a payments of Rs 25,708 and Rs 32,910, respectively to the builder. Again, on February 1, 2013, we made a payment of Rs  5 lakh to the builder. So, till date we have paid Rs 28,58,618 to the builder and we have received a credit of Rs 2,42,563 from the builder which is adjusted against future instalments. The flat buyer’s agreement with the builder was signed on December 15, 2010 and the allotment letter was signed by the builder on June 15, 2010. We haven’t got the possession of the flat as yet and it is expected mid-2014.

My queries are, if we sell our allotment in July:

* From which date the period of holding would be counted?

* What amount would be considered as the cost of acquisition for the purpose of computing capital gains? — Sunil

A. The date of holding the flat would be the date of allotment of flat to you. The cost of acquisition of the flat would be the total amount paid to the builder less the amount of discount, if any, received plus the cost of stamp duty and registration charges of the flat in your favour.

What is the tax liability on insurance claim amount?

Q. I am a sole proprietor and am manufacturing toys for children. I own a factory building which (along with the machinery) was completely destroyed in a fire caused due to fault in the electrical wiring. Is the amount received from the insurance company with regard to the destruction of these assets exigible to capital gains tax? I have been informed that amount so received is not taxable but insurance people have informed me that the amount received from insurance company would be taxable. — Rameshwar Sarup

A. In Vania Silk Mills Private Limited vs. CIT, the Supreme Court had held that insurance claim received on account of destruction of a capital asset is not chargeable to tax as the destruction does not amount to a transfer. The judgment has been nullified to some extent by the introduction of a new sub section (1A) to Section 45 of the Act w.e.f. assessment year 2000-01. According to the said sub section where a person receives during the previous year, any money or other assets under any insurance from an insurer and the compensation has been received because of damage or destruction of a capital asset and such damage and destruction is as a result of following categories of circumstances:

* Flood, typhoon, hurricane, cyclone, earthquake or other convulsion of nature; or

* Riot or civil disturbance; or

* Accidental fire explosion; or

* Action by any enemy or action taken in combating an enemy (whether with or without a declaration of war).

Then any profit or gain arising from the receipt of such money shall be chargeable to Income Tax under the head “capital gains”. The amount received from the insurance company shall be deemed to be full value of consideration received or accruing as a result of the transfer of the asset. Accordingly in your case the amount received from the insurance company on account of destruction of factory building and the machinery will be treated as full value of consideration accruing as a result of the transfer of such capital asset. The amount received in excess of the written down value of such capital assets would be taxable as a short-term capital gain in view of the provisions of Section 50 of the Act

TDS on salary and loss from house property

Q. An employee is working in Delhi and is paying rent and is claiming HRA tax rebate. He also has taken a home loan and the house is in Mumbai. The house in Mumbai has been let out by him and he is getting rental income from the same. My queries are as follows:

* Can his interest on housing loan be allowed as loss from house property for the purpose of TDS on salary income? If yes, what is the maximum limit?

* Can his repayment of home loan be allowed as deduction under Section 80C for the purpose of TDS on salary income?

* Should his income from house property be considered by the employer while allowing the benefit of loss from house property due to interest on home loan for TDS on salary income?

Kindly let me know the correct treatment and reference of any CBDT circulars (if any) for my better understanding. — Anutam

A. It is presumed that the query is in respect of the house in Mumbai which has been let out and the housing loan has been obtained against such property. Reply to your queries is, therefore, based on the said presumption.

* In accordance with the provisions of Section 71B, where for any assessment year the net result of computation under the head “income from house property” is a loss to the assessee and such loss cannot be or is not wholly set-off against income from any other head of income of, so much of the loss as has not been set-off the whole loss is allowed to be carried forward to the following assessment year for the set-off against income from house property assessable for that assessment year and if not wholly set-off the amount of loss can be carried forward to the following eight assessment years. Accordingly, it should be possible to set-off the loss under head “income from house property” against the income under head “salary”. In case of a let-out house, there is no limit with regard to the deductibility of interest from the annual letting value. The limit as to the deductibility to the extent of ~1,50,000 is applicable in respect of a self-occupied house.

* Deduction under Section 80C of the Income-Tax Act, 1961 (The Act) is allowed in respect of the amount repaid towards the loan obtained for purchase or construction of a residential house from the specified source. Such deduction is allowable within the allowable limit of Rs 1,00,000 provided in the said Section. A tax payer can claim such deduction from his total income provided conditions prescribed as Section 80C of the Act are complied with.

* The employer can consider the benefit of loss from house property for the purpose of deduction of tax at source provided the relevant particulars have been filed by the assessee with the employer. Rule 26B of the Income-Tax Rules 1962 (The Rules) provides that an assessee may send to the person responsible for making payment under sub-section (1) of Section 192, a statement of any income chargeable under any head of income other than “Salaries” (not being a loss under any such head other than the loss under the head “income from house property”), received by the assessee for the same financial year, and of any tax deducted on such income. The particulars so sent can be in a simple statement which is properly signed and verified by the tax payer in the manner prescribed under Rule 26B(2) of the Rules. The employer will take such particulars into consideration while deducting tax at source.

REALTY GUIDE
Can I give an affidavit to change Will?
b.k. sANGHI

Q. On the last page of my registered Will, I had written “as in future as whenever I feel the necessity of modification/addition in my this Will, I would give an affidavit. That modification/addition should be considered as a part of this Will”. Now if I write on the affidavit (mentioning modification/addition) that my this affidavit is not time barred and it is to be made effective after my death, then will it be legally correct ? — Vinod Kumar

A. A Will is a legal declaration by which a person, names one or more persons to manage his/her estate and provides for the distribution of his property on death.

You have full right to change your Will. You can revoke or amend the Will or execute a fresh one till you are alive. Will is also linked with the dying declaration of a person and can be changed according to the circumstances.

A dying declaration is considered a credible and trustworthy evidence based upon the general belief that most people who know that they are about to die do not lie. As a result, it is an exception to the Hearsay rule that prohibits the use of a statement made by someone other than the person who repeats it while testifying during a trial, because of its inherent untrustworthiness. If the person who made the dying declaration had the slightest hope of recovery, no matter how unreasonable, the statement is not admissible into evidence. A person who makes a dying declaration must, however, be competent at the time he or she makes a statement, otherwise, it is inadmissible.

Dying declarations are allowed as evidence in Indian courts if the dying person is conscious of his or her danger, he or she has given up hopes of recovery, the death of the dying person is the subject of the charge and of the dying declaration, and if the dying person was capable of a religious sense of accountability to his/her Maker.

Q. I am working in a public sector company at a junior management post in Chandigarh. I plan to purchase some agricultural land in the next few years. My grandfather had a farm which had to be sold a couple of years ago due to some financial crisis. What are the options available to me for buying agricultural land. Can any one buy agricultural land ? — Himanshu Chauhan

A. There are no restrictions on buying agricultural land for Indians, however, NRIs can’t buy it. So in your case you can buy agricultural land without any hitch. You have not mentioned in your query where you are living at present, if it is a bigger town then you may not have much choice of agricultural land nearby. The prices near urban centres are also very high and a lot of land is being bought by builders or government bodies for extending urban projects. So if you want land for agricultural purpose then you may have to look for areas in the interiors of your state where the price too may be less. Another thing to be kept in mind is the finance part as not many loan options are available for buying agricultural land. So be on the lookout for good deals.