Loan taken for personal use by son

This query is : Resolved

DIVYESH JAIN (Querist)
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08 June 2023 Dear Sir,

If a person is having a pending loan can this loan be repaid by her mother in a single transaction. Later in a spam of 4-5 years the person will return her back the amount which she has transferred to the loan account of his son. His mother's name is nowhere mentioned in the loan account. The loan amount balance is of 1 cr.

Is it ok if this transaction happens. Will there be any compliance issue for them from Income tax.

Please help me in this matter.

Regards,
Divyesh Jain

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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08 June 2023 Better option would be to take the amount from mother, and repay the loan amount by son himself.
All transactions should be through banking channel.

DIVYESH JAIN

DIVYESH JAIN (Querist)
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08 June 2023 Yes, but that will take around 3 days to transfer as the amount is huge. They want to save the interest amount of 3 days.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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08 June 2023 That cannot be an excuse, when by RTGS instant transfer of 1 Cr is permitted.

DIVYESH JAIN

DIVYESH JAIN (Querist)
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08 June 2023 Okay. Thanks for your advice. Will suggest accordingly.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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08 June 2023 My pleasure.