Interest free unsecured loan...
This query is : Resolved
19 April 2014
assessee wants to take interest free unsecured loan for three year. there is any income tax liabilities on loan provider and loan receiver under the income tax act..
Nikhil Kaushik
(Expert)
21 April 2014
loan receiver remains safe. However, the loan provider can face tax issues if he has interest bearing borrowings. will vary from case to case.
K.M.CHANDRAN
(Expert)
22 April 2014
NO TAX LIABILITY ON THE BORROWER. NO TAX LIABILITY ON THE LENDER AS FAR AS THE LOAN IS CONCERNED.
Nikhil Kaushik
(Expert)
22 April 2014
Chandran,
there are case laws after case laws where additions to income have been made (vide disallowance of interest on borrowed funds) if interest free loans have been given.
please refer M/s Southern Bottlers Pvt. Ltd. ...Respondent CORAM: HON'BLE MR. JUSTICE HEMANT GUPTA for an example.
there are case laws after case laws where additions to income have been made (vide disallowance of interest on borrowed funds) if interest free loans have been given.
please refer M/s Southern Bottlers Pvt. Ltd. ...Respondent CORAM: HON'BLE MR. JUSTICE HEMANT GUPTA for an example.
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