Interest on Unsecured Loan

This query is : Resolved 
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This discussion clarifies whether interest payments on unsecured loans from friends and relatives are mandatory according to the Income Tax Act. The consensus is that it is not compulsory. Interest payment is only required if it's part of a mutual agreement between the individuals involved.

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(Querist)
15 April 2020 Dear Sir,

Is it mandatory to pay interest on unsecured loans availed from friends and relatives as per Income tax act, please advice.

Arjun
7780309128
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RAJA P M

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RAJA P M (Expert)
15 April 2020 No more restrictions (or mandatory) for compulsory interest paid if it's not received against interest...
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Aashok Kumar Sharmapro badge

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Aashok Kumar Sharmapro badge (Expert)
05 May 2020 It is not compulsory and is only subject to mutual agreement agreed to between individuals.
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