Repayment of Loan Section 269T
This query is : Resolved
09 November 2009
A person start a business of share broker with Rs. 10 Lacs and he collected this amount by taking loan of Rs. 2 Lacs from 5 persons.
He invest out of Rs. 10 lacs , Rs. 1 lac of each person cmprising Rs. 5 lacs in IPO in their names.
Will it be treated as repayment of loan u/s 269 T as the application of IPO in the respective persons' name.
Consider the word 'Account Payee D/D or Cheque' u/s 269T.
He invest out of Rs. 10 lacs , Rs. 1 lac of each person cmprising Rs. 5 lacs in IPO in their names.
Will it be treated as repayment of loan u/s 269 T as the application of IPO in the respective persons' name.
Consider the word 'Account Payee D/D or Cheque' u/s 269T.
09 November 2009
Repayment of loan cannot be done by adjustment entries like this u/s 269T. You have to pay by a/c payee cheque only. Only banking companies are permitted to repay by crediting the account of FD holder with them.
10 November 2009
No investment in the name of other person will not be treated as repayment of loan
10 November 2009
plz quote relevant provision/section suggesting that the adjustment is not allowed u/s 269T
11 November 2009
The section itself reads as other than by payee's account cheque or draft. For only Banking Company as per banking Regulation Act it is specified that they can credit the account maintained by them of the Payee. Therefore every other payee will have to use only payee's account cheque or draft to repay the loan and they cannot repay by debit and credit adjustments. If a broker is doing business with the person and during course of business the advance has been given by the person to Purchase Shares on their behalf in IPO then it is not a loan and amount invested in IPO is not a repayment. However parties must transact by modes outlined in Rule 6DD / Section 40(A) for such amounts.
Therefore as opined by the expert Rajnish, your purchasing the shares in IPO will not be treated as a repayment if your loan is still outstanding and the person is a debtor to the broker on current account. You must complete repayment of all loan transactions by A/C payee cheques or D/Ds only.
Therefore as opined by the expert Rajnish, your purchasing the shares in IPO will not be treated as a repayment if your loan is still outstanding and the person is a debtor to the broker on current account. You must complete repayment of all loan transactions by A/C payee cheques or D/Ds only.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- TDS on Purchase of Immovable Property by NRI from NRI
- INTEREST APPLICABLE ON ITC REVERSAL PORTION
- Current Account Opening for Sole Proprietorship with Udyam Certificate - Zero Turnover
- Capital gain from sale of house property
- Value of property in capital gain
- When TDS on GST applied
- Before GSTAT- APL-02 Vs APL-04
- Annual return in Gst
- Copyright software
- SFT Cash Deposit in Current Account
- GST Treatment of Insurance Commission for Existing GST Holder
- Cash gift by grand mother to her grand daughter
- Tax amount diff in Gstr1 and 3B in tax compare reports
- Tds on GST in connection with sale to public company
- Restoration of certificate of practice
- Regarding change in correspondence address in SSP portal
- No Compliences after incorporation
- USEFUL LIFE OF USED/SECOND HAND COMMERCIAL VEHICLES
- Claiming TDS deducted by builder on Hardship compensation and Corpus
- Address Change to another state of a Registered Trust with 12AB approval
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
CAclubindia
