Section 80EEB - Interest deduction in respect of purchase of Electric Vehicle

SECTION 80EEB - DEDUCTION OF INTEREST PAID FOR PURCHASE OF ELECTRIC VEHICLE

What are the conditions for availing of deduction u/s 80EEB?

1.This deduction is available to any Individual only.

2. The total deduction of Interest shall not exceed Rs. 150000/- during the year.

3. This deduction will be available from Asstt. Yr. 2020-21 onwards.

4. The loan should be sanctioned for the purchase of any Electric Vehicle during the period 01-04-2019 to 31-03-2023.

5. If the deduction of interest has been claimed under this section, it can not be claimed under any other section of the Income Tax Act.

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Some important definitions for this section are -

(a) Electric Vehicle means -

A vehicle that is powered exclusively by an electric motor whose traction energy is supplied exclusively by a traction battery installed in the vehicle and has such electric regenerative braking system, which during braking provides for the conversion of vehicle kinetic energy into electrical energy;

(b) Financial Institution means -

a banking company to which the Banking Regulation Act, 1949 applies, or any bank or banking institution referred to in section 51 of that Act and includes any deposit-taking non-banking financial company or a systemically important non-deposit taking non-banking financial company as defined in clauses (e) and (g) of Explanation 4 to section 43B.

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