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Justification of 15% interest U/s 40 A 2(b)

This query is : Resolved 
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(Querist)
20 June 2008 please give me the sitation of defending interest at 15 % allowable Vs 12% on Loan.
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CA Hemant T Dewani

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CA Hemant T Dewani (Expert)
20 June 2008 12% interest given to partners is compulsory not for others
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Late CA Sampat Jain

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Late CA Sampat Jain (Expert)
20 June 2008 Excessive interest paid is disallowed u/s 40(a)(2)(b) .Now what is excessive depends on the facts of the case.

You may be in a position to justify the rate of interest if you can prove that circumstances were such that you were not getting loans at less that 15% ........OR you are alredy payig more than 15% to non relative etc
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