FDR interest

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Kamal KUmar Gupta (Querist)

19 January 2009 Please advice me whether interest on FDR can be adjusted against interest paid to bank on loan taken for the security of the same FDR? what if the FDR is different?

Please reply asap

Thanks

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)

19 January 2009 No set off is allowed. Citation: CIT Vs Dr. V.P. Gopinathan (SC).

CA. Gurdeep Singh Chawla

CA. Gurdeep Singh Chawla (Expert)

19 January 2009 disclose separately

K V Subba Rao

K V Subba Rao (Expert)

19 January 2009 I agree with Mr Warrier

I have few FDs with a Co-operative Society. I took loan against FDs and applied for IPOs (earlier, not these days). I requested the Society to give Interest income certificate after deducting Interest collected from me on loans availed by me but they regretted their inability

If you earn any income by deploying loan amount, perhaps, you may be able to claim interest paid by you on loan against FDs but this aspect has to be carefully studied keeping "status" and "source of income"

In any case, interest suffered on loans against FDs cannot be set off against interest earned on FDs

While quoting case law, if Sri Warrier could provide "link", wherever available, would be of great help to Queriest and Readers to immediately study the same for fuller appreciation of subject

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