banner_ad

Can partnership firm give unsecure loan to another partnership firm

2059 views 5 replies

can partnership firm give unsecure loan to another partnership firms as both firms some partners are same ?

Replies (5)
yes why not....provided all partners aggred to provide loan to another partnership firm
sir any act that I can refer
Please refer new deposit rules

1. One partnership firm very much provides Loan to another partnership firm. It could be secured loan or an unsecured loan. There is no separate provision in Income tax restricting loans to another firm (even in case of common partners) 
2. However, Sec 40A(2)(b), if the expenditure incurred is unreasonable or excessive that will attract disallowance. 
3. In your case, the firm which is giving an unsecured loan will not have any IT implications unless the interest charged from the other firm is unreasonable or excessive. If that's the case Sec 40A(2)(b) will come in operation and to the extent of unreasonable or excessive amount will attract disallowances. 
Please correct me if the solution has an alternative view.

thank you very much for fruitful suggestions


CCI Pro

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
Featured 02 May 2026
Senior Executive

hitesh chandwani & co

Pune

B.Com

View Details
Company
Featured 29 April 2026
Manager- Finance and Compliance

Naveen Fintech Pvt Ltd

Kolkata

CA Inter

View Details
Company
Featured 14 April 2026
GST CONSULTANT

Abhishek G Agrawal & Co.

Korba

CA Final

View Details
Company
Featured 13 April 2026
GST CONSULTANCY

Abhishek G Agrawal & Co.

Korba

CA Final

View Details
Company
Featured 28 March 2026
Accountant

Ashok Amol & Associates

New Delhi

B.Com

View Details
Company
Featured 28 March 2026
CA Final

Ashok Amol & Associates

New Delhi

CA Final

View Details
Company
Featured ARTICLESHIP 19 March 2026
Article Assistant

Gupta Sachdeva & Co. Chartered Accountants

New Delhi

CA Final

View Details
Company
Featured 14 March 2026
Associate CA

N N V Satish&co

Hyderabad

CA

View Details