Mr. Chaddha (55 years old) owns two self-occupied flats in Delhi. Flat I has a Municipal Valuation Rs. 6,00,000, Fair Rent is Rs. 6,80,000, Standard Rent is Rs. 6,65,000; Municipal Taxes paid during the year Rs.5,000; Mr. Chaddha has paid interest of Rs.50,000 during the year for renovation of flat I.

His other flat (Flat II) has a Municipal Valuation Rs. 8,00,000; Fair Rent is Rs. 9,00,000; Standard Rent is Rs. 12,00,000; Municipal Taxes outstanding Rs. 24,000; Interest on Borrowed Capital paid by Mr. Chaddha during 2018-19 Rs. 8,50,000; past unrealized rent (pertaining to previous year 2015-16) Rs. 30,000 is recovered during the year 2018-19.

His income under the head other sources during PY 2018-19 is Rs.6,00,000. Mr. Chaddha seeks your advice on choice of self-occupied house and his taxable income & tax liability.