Interest paid

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anil (Querist)
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16 June 2010 I have paid interest to bank on my Overdraft against deposits pledged with Bank. Can I claim this as a deduction while computing interest income (i.e. Interest on depsits received Less Interest paid on Overdraft)? My other incomes are Salary,Capital gains etc..

Rahul Gupta

Rahul Gupta (Expert)
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16 June 2010 No interest paid to bank on overdrafts is allowed as deduction only in case it is a business or profession expenditure. It is not allowed in case of salary and capital gains or other income.

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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16 June 2010 As per supreme court decision in CIT Vs. Dr. V.P. Gopinathan (2001) 248 ITR 449(SC) such set off is not permitted if interest income is offered under the head " Income from other sources".

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