The Hindu Business Line : Will loan taken from friend qualify for deduction?

Section 24 dealing with, among other things, interest as an expenditure while computing income from house property, stipulates no conditions as to the status of the lender, but Section 80C insists on the lenders being from the organised sector such as banks or financial institutions or one's own employer.

In the event, loans from friends would not make the grade under Section 80C when it comes to the principal but would make the grade under Section 24 when it comes to interest.

PAN for granny

A grandma, past her 90th year, proposes to dispose of her generations old inherited residential property and invest the proceeds in either NHAI or REC, if at all the companies release new bonds.

Besides this, she has no income under any other head. Presuming NHAI or REC would release capital gains savings bonds and our granny is able to save her taxes on long-term capital gain, yet is she under an obligation to obtain PAN or can she just declare, without obtaining PAN, she does not have taxable income?

R.M. Subramaniam

She has neither to obtain PAN nor to file return. Both these requirements are attracted only when a person is likely to have taxable income that is income in excess of tax-free limit.

By investing in tax savings bonds, she would not have any taxable income and is, therefore, immune from both obtaining PAN and from filing return.

This is strange because the income-tax law does not allow salary earners the luxury of not filing the return on the ground that their provident fund and PPF contributions etc., vetted by their employers for good measure have the effect of pushing their income below the taxable limit.

Book profit calc

Can a company claim deduction under Section 80HHC while calculating its book profits for the purpose of MAT after having claimed Section 80-IB deduction from gross total income (GTI)?

Keyur Patel, email

Section 80HHC is no longer in vogue. Assuming you are referring to a previous year in which it was in vogue, the amount deductible would exactly be the same as computed under that section.

Getting Section 80-IB deduction does not preclude this.

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