Presently I reside in a rented accommodation.

After booking an apartment, I opted for a home loan in July 2005.  As per the builder's (false) commitment for possession of October 2005, I went ahead with an advance disbursal facility. So, my actual Equated Monthly Installments started in August 2005 itself. 

The work is still not complete and possession is expected around March � April, 2006.

I have listed my questions below.

- Nilesh

1. Can I get an income tax benefit on the EMI for the current financial year?

The deduction for the year ended March 31, 2006, depends on whether the construction of the house property is completed before March 31, 2006.

If yes, you can claim deduction in this year itself.

If it is not complete, you get no deduction this year.

2. Can stamp duty and registration amounts be claimed for tax exemption?

Deduction under Section 80C is available for stamp duty and registration charges paid this year only if the construction of the property is completed by March 31, 2006. Else, this deduction will be lost forever.

3. Can I claim both HRA and EMI exemption in current financial year?

You can definitely claim House Rent Allowance as long as you stay in a rented house that is not owned by you.   

Like I mentioned, as far as your tax deductions go for the year ended March 31, 2006, it depends on whether the construction of the house property is completed before March 31, 2006. If yes, you can claim deduction in this year itself. If it is not complete, you get no deduction this year.

Irrespective, you can claim your HRA.

4. It is mentioned in the agreement that 'possession can be delayed under certain circumstances'.  Can any legal action be initiated against builder?

This will depend on the facts and circumstances of each case. Please consult consumer activist bodies such as the Mumbai Grahak Panchayat or the Consumer Guidance Society of India.