oppn parties Study Abroad and Get Deduction for Interest Paid on Edu Loan

News Snippets

  • 84 NDRF teams have been despatched to 23 states to tackle the flood situation
  • Three persons lynched in Bihar after being accused of cattle theft
  • Delhi police seize a consignment of 1500 kgs of heroin and busts a cartel of Afghanistan-Pakistan narcotics dealers with links to the Taliban
  • Supreme Court gives 9 more months to complete the Babri Masjid demolition case trial
  • Priyanka Gandhi not allowed to meet the families of the dead in the Sonabhadra firing, arrested
  • ICC inducts Sachin Tendulkar in [email protected]@@s Hall of Fame
  • Stock markets bleed for the second day. Sensex crashes 560 points
  • S Jaishankar, Minister of External Affairs, says Pakistan should release and repatriate Kulbhushan Jadhav immediately
  • Karnataka Governor Vajubhai Vala asks the Speaker to hold the trust vote latest by 1.30 pm today
  • The Government sends a list of 24 questions to mobile app company that runs video app TikTok seeking answers for anti-national and obscene content carried on the platform
  • Sarvana Bhawan founder P Rajagopal, serving a life term for murder, dies in a Chennai hospital
  • SC allows time till July 31 to the Ayodhya mediation panel
  • IT department attaches "benami" plot worth Rs 400cr in Noida. The plot allegedly belongs to BSP leader [email protected]@@s brother and his wife
  • Dawood [email protected]@@s nephew, Md. Rizwan Iqbal, was arrested from Mumbai airport as he was waiting to board a flight to Dubai
  • Trouble brews in Bihar JD(U)-BJP alliance as Bihar police asks special branch officers to keep tabs on RSS activities
Even after indicating that the trust vote will be held today (he said he cannot delay as he had to face the world), the Karnataka Speaker adjourns the assembly until Monday. Voting is likely to take place on Monday
oppn parties
Study Abroad and Get Deduction for Interest Paid on Edu Loan

By Sunil Garodia

About the Author

Sunil Garodia Editor-in-Chief of indiacommentary.com. Current Affairs analyst and political commentator. Writes for a number of publications.
Section 80E of the Income Tax Act says that parents can claim deduction for interest paid on any education loan taken for their children’s higher education. The only criterion prescribed is that such loan must be taken from banks, financial institutions or approved charitable organizations. Higher education has been defined as “any course of study pursued after passing the senior secondary examination (SSE) or its equivalent from any school, board or university recognized by the Central government, state government, local authority or any recognized authority.” Nowhere is it stated that course for higher studies must be pursued in India.

But some overzealous income tax officers (ITO) have been regularly disallowing the interest paid on such loan if the child is pursuing a course abroad. They will not be able to do so anymore as the Income Tax Appellate Tribunal (ITAT) in Pune has categorically stated that the section does not say that such higher education courses must only be pursued in India in order to get tax benefit.

The stated objective of this section was to promote higher education in a class of persons who had the will and the ability but not the means. It did not differentiate between study in India or abroad for the simple reason that it was promoting education and not educational institutions. Instead of reading the section as a whole, these ITOs decided that the second half of the higher education definition meant that the higher education course must be recognized by the Central government, state government, local authority or any recognized authority. Now with this ITAT order, things have become clear.