Property feud between brothers

My father had constructed a house almost 28 years ago in his native by availing a housing loan form his company. After the completion of the house my father who was living in a town allowed his younger brother to reside in that house as he was taking care of my father's properties(my father's share in joint property) in native. Recently, my father's brother, who was residing in my father's house all these years has made some major alteration in the house and when questioned he claims the ownership of the house stating that though my father had availed a loan to construct the house he had used the fund released for his personal use and not towards the construction of the house and that the house was constructed only by the fund raised from joint property income. My father's brother refuses to vacate the house and has challenged my father through a lawyers notice stating the above and also faulty accusing my father of threatening their life, which is not true. He has also dragged my brother's name who is employed in a private sector threatening that he would inform my brother's employer about my brother's unlawful means with regard to the house along with my father. My question is will his statement that my father has not used the loan amount for the construction purpose and only for personal use be accepted by law against my father? Secondly, though my brother or my father have not indulged in any kind if unlawful means of threatening my father's brother as stated by him, will it be accepted by the court and will my brother have any problem with his career because of this false allegation? Can my father's brother claim the ownership of the house through it is documented in my father's name? Kindly advuse