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FORM 37 ( I)
When buying a property that costs over Rs. 25,00,000, the Income Tax Act requires you to inform the Income Tax department, along with all the details of the flat you are buying. There is a prescribed form for this. The Income Tax Department has the right to purchase the flat at the same price as you have agreed to buy the flat instead of you and auction the flat in the open market. The idea behind this section of the Income Tax Act is that if the Income Authorities feel that the property has been sold below the market value then the Income Tax Department will acquire the property and sell it at the fair market value. The objective of this chapter is to try and cut out the black money transactions from property transactions. [Rule-48(K)].

SECTION 24 (2)
Interest Deductions - The budget presented by the Finance Minister in 2000 has increased the ceiling on the amount of deductions from Rs. 30,000 up to Rs.100,000 from an individual's income if it is  self-occupied for the interest paid for a home loan.
The income tax act gives a person who does not own a residential house a concession to purchase one when they sell a capital asset. If you sell a capital asset, normally, you are required to pay tax on the gain in the value of the asset after indexation of the cost. If however you do not own a residential house, you can reinvest the net consideration you received from the sale of the capital asset in a house property and not pay any income tax on the gain from the sale of the capital asset. There is however a time frame of within which to reinvest the funds from the gain of the sale of the capital asset.

Any seller of house property is required to produce an Income Tax Clearance Certificate u/s 230 (1) before the registration authorities. This is required at the time of registration of the document. This certificate is issued to show that the seller is not in default of any taxes.
Reinvestment of House Property - An individual or HUF reinvesting the net proceeds from the sale of a house in another residential house is exempted from Capital Gains Tax u/s 54, provided the new house is purchased within 2 years after or one year prior to the date of transaction
SECTION 139 (1)
All persons whose income is below taxable limits in occupation of immovable property exceeding 800 sq.ft. Residential Property or 125 sq.ft. Commercial Property are required to file Form 2(C) with the income tax.
Repayment of the principal of a home loan up to Rs. 20,000/- is eligible for deduction under Section 88 whereby 20% (i.e. Rs.4000) can be deducted from the total amount of tax payable

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