Hi Friends
Interest free loan taken from friend for Rs.15, 00,000/-. This loan amount is used for trading & income earned from such loan amount is Rs.1,00,000/- ..
Is the interest free loan amount is taxable as Gift under the head “Income from Other Sources”
HI Amit,
After a long time.......:)
IF YOU CAN PROVE THAT THE TRANSACTION IS INTHE NATURE OF "LOAN" & NOT "GIFT" THEN IT CANNOT BE ADDED TO THE INCOME.
Ways to prove -
1) Loan Agreement
2) Balance Sheets of Borrower as well as Lender.
3) Repayment in full or in part, will help you in proving that the transaction is of "Loan" (in the absence of above)
Thanks for the Valuable information Amir.
CAclubindia
