Fdr in the name of director

This query is : Resolved

SURENDER KUMAR GOYAL (Querist)
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22 November 2013 A person has fixed deposit in a bank.The same person is director in a company.The company has taken Occ limit against the fdr in the name of director. The interest paid on occ limit is debited as expense of Company and interest on fdr is credited in director's saving account. Kindly tell the consequences regarding Income Tax Act.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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22 November 2013 there is no link between the two. Transactions entered into by the director in his personal capacity have no link with the company's interest liabilities.

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SURENDER KUMAR GOYAL

SURENDER KUMAR GOYAL (Querist)
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22 November 2013 CAN COMPANY CLAIM INTEREST AS EXPENSE IN IT'S BALANCE SHEET. CAN IT BE DISALLOWED BY IT A.O.AS COMPANY HAS NOT MORTGAGED ANY PROPERTY AG. OCC LIMIT,HOWEVER THE DIRECTOR IS PAYING INCOME TAX ON INTT. EARNED

Nikhil Kaushik

Nikhil Kaushik (Expert)
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22 November 2013 no. no disallowance is warranted. and director's FDR has no relation to this if he has used his own money for deposit of this FDR.

CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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22 November 2013 both are independent to each other and factually law will not link it unless any of provisions under income tax act mentions abt it.

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