20 June 2019
Two persons started a partnership firm and in order to fund the work, both of them took personal loans in their name. Now both of them put the money received as Capital for business in separate account opened in the name of business and started to pay EMI on the loan from their personal accounts.
Now my question is that, can the partners Capitalize the interest paid on that loan EMI or claim the interest as business expense? What exactly the law says or is there any case law reference for the same. Experts, kindly advise.