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sumit (Querist)
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16 April 2012 If an Indian company takes loan from a bank in Pakistan for business purpose, whether interest paid on such loan is deductible as business expenditure.

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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16 April 2012 Pakistan is notoriously known for financing and promoting terrorists and terrorism. I hardly believe that Pakistani Banks finance to peaceful activities like legally conducted businesses.
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However, if the amount is borrowed for the purpose of a legal business and the amount has been borrowed by following the regulatory guidelines in this behalf, interest on such loan will be an allowable business expenditure.
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C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
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17 April 2012 If an Indian Company having branch in Pakistan it can borrow funds from Pakistan Banks and if it is utilised for business purpose then it is allowable.

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