tax advice

Contribution to son’s PPF a/c fetches rebate

Can I claim rebate under Section 80C by depositing amount into my major son’s PPF account? — ravi rana

SC Vasudeva

Can I claim rebate under Section 80C by depositing amount into my major son’s PPF account? — ravi rana

Section 80C(2)(v) of the Act provides that an amount paid or deposited not exceeding Rs 1,50,000, as contribution to any Provident Fund set up by the Centre in an account standing in the name of an individual, his wife or any child of an individual shall be allowed as deduction against the total income of an individual. The word “child” has been judicially interpreted to include a major son and therefore, any deposit made by you in your major son’s Public Provident Fund account would be considered for the purpose of allowability of deduction under Section 80C.

If annual income from a rented accommodation is 

Rs 1.20 lakh and the owner pays Rs 4,000 plus service tax to the government department or local authorities (municipal committee) on account of maintenance of common area and common services (i.e annual maintenance charges) as levied by dept/MC for all residents, will these maintenance charges be deducted from annual income of the rented accommodation for the purpose of income tax? — tk sharma

Section 24 of the Income Tax Act, 1961, allows a deduction of 30% from the annual letting value to cover such expenses. Therefore, apart from the above deduction, which is allowable under the aforesaid section, no other deduction except the amount of interest paid on the amount borrowed for purchase or construction of a house is allowable for the purposes of computing taxable income from house property. In fact, in one of the decisions of a High Court, it has been held that the maintenance charges paid directly by the lessee be included for deducting tax at source. In case this decision is applied, income from house property may have to be computed taking into account the rental plus the maintenance charges payable directly to the maintenance agency by the lessee.

I am working with the Punjab Government. I got my salary arrears of Rs 8,13,352 from August 12 to October 13 in 2015-16 and my gross salary for 2015-16 was Rs 7,78,302. Other details are: 

1. Gross salary (2015 16):  Rs 7,78,302; Deduction CPF: Rs 69,497; GIS: Rs 1,440; TDS: Rs 51,000; Savings: Rs 1,50,000, including CPF, GIS, insurance etc. I pay a house rent Rs 48,000 per annum. 

2) Arrear of salary from Aug 12-Oct 13 gross amount: Rs 8,13,352 

Deductions— CPF: Rs 71,017; GIS: Rs 1,800; TDS: Rs 1,95,000  

Savings (2012-13)— NSC: Rs 1,50,000 excluding CPF, GIS of 2012-13 

Savings (2013-14)—NSC: Rs 1,50,000, excluding CPF, GIS etc. of 2013-14.  

I have submitted rent receipts of 2012-13, 2013-14 and 2015-16 of Rs 48,000 each per annum with my DDO.

* I did not file my IT returns for 2012-13, 2013-14 as I drew salary Rs 2,25,352 (March 2012-July 2012) and Rs 1,97,284 (Nov 2013- Feb 2014).  

*I have already filed my returns of 2015 -16. 

* My wife is also working. I did savings for tax benefits from her salary. — shree bhagwan sharma

It would be advisable for you to seek a relief under Section 89 of the Act in respect of the arrears which have been received by you in the financial year 2015-16.  You can make an application to the Assessing Officer for giving you the desired relief under the aforesaid section.  This is because the returns for various years referred by you cannot be revised now.


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