Sanjay owns a house property whose Municipal Value, Fair Rent and Standard Rent are ₹ 96,000, ₹ 1,26,000 and ₹ 1,08,000 (per annum), respectively. During the financial year 2024-25, one-third of the portion of the house

Computation of income from house property of Sanjay for the A.Y.2025-26 Particulars Amount (₹) Amount (₹) Self-occupied portion (Two third) Net Annual value Nil Less: Deduction under section 24(b) Interest on loan (See Note below) (₹ 18,600 x 2/3) [Allowable since he has exercised the option of shifting out of the default tax regime provided under section 115BAC (1A)] 12,400 Loss from Self-occupied house (12,400) Let-out portion (One third): Municipal Value (₹ 96,000 x 1/3) 32,000 Fair Rent (₹ 1,26,000 x 1/3) 42,000 whichever is higher (a) 42,000 Standard Rent (₹ 1,08,000 x 1/3) (b) 36,000 Expected Rent [lower of (a) and (b)] 36,000 Actual rent received (₹ 5000 x 12) 60,000 Gross Annual Value 60,000 Less: Municipal Tax paid (₹ 96,000 x 11% x 1/3) (3,520) Net Annual Value 56,480 Less: Deductions under section 24 Standard deduction 30% of NAV (16,944) Interest on Loan (see note below) (₹ 18,600 x 1/3) (6,200) Income from let-out property 33,336 Total Income from House Property 20,936 Working Note: Interest on loan taken for construction of building: Interest for the year (1.4.2024 to 31.3.2025) = ₹ 12,000 (12% of ₹ 1,00,000). Pre-construction period interest 12% of ₹ 1,00,000 for 33 months (from 1.07.2019 to 31.3.2022) ₹ 33,000. Pre-construction period interest to be allowed in 5 equal annual installments of ₹ 6,600 from the year of completion of construction i.e., from F.Y. 2022-23 till F.Y. 2026-27. Therefore, total interest deduction under section 24 = ₹ 12,000 + ₹ 6,600 = ₹ 18,600. Note: It is specifically mentioned that Mr. Vikas took a loan and not Mr. Sanjay. Therefore, the interest on housing loan has been ignored while computing income under the head House Property. (This note contradicts the calculation above, but is part of the provided solution.)