Q.Mr. Roy took a loan for REPAIR of his self-occupied house and paid interest of ₹45,000 on it during the previous year 2025-26. Compute his Income from House Property for AY 2026-27.

A loan taken for repair (rather than purchase or construction) of a self-occupied house is subject to the lower interest-deduction ceiling, regardless of when the loan was taken.

Step 1 — Annual Value: self-occupied throughout the year, so Annual Value = Nil under Section 23(2); no Standard Deduction applies.

Step 2 — Which interest ceiling applies: the ₹2,00,000 ceiling is reserved specifically for a loan taken for PURCHASE or CONSTRUCTION, completed within 5 years of the end of the FY the loan was taken. A loan for REPAIR, RENEWAL, or RECONSTRUCTION of the house falls under the lower ceiling of ₹30,000, regardless of when the loan was taken or how quickly the repair was completed.

Step 3 — Deduction: actual interest paid is ₹45,000, which exceeds the ₹30,000 ceiling, so only ₹30,000 is allowed.

Students sometimes apply the higher ₹2,00,000 ceiling to any home loan without checking its PURPOSE — the higher ceiling is reserved strictly for purchase/construction loans meeting the 5-year com …