I would like to know the expert view on the following issue :
Mr. X is a director in a company. He earns salary income, rent income and interest income as his personal income during a particular year. He has borrowed, say Rs. 50 lakhs in his personal capacity. OF the Rs. 50 lakhs, he has given loan of Rs. 20 lakhs to the company where he is a director and earns interest @ 12% p.a. He also pays 12% interest on the borrowing of Rs. 50 lakhs. Remaining Rs. 30 lakhs, he has invested in immovable property and he does not earn any income. My question is :
Can an assessee, in his personal income tax return, can claim negative interest as loss from other sources, ( as interest paid is Rs. 5 lakhs and interest earned is Rs. 2 lakhs), say of Rs. 3 lakhs and the same be adjusted against income from other heads ?
If you have not understood the question, I would like to clarify further on further comments/information required at your end.
Any judgements on the above issue ?
Kindly address my above issue as the stake involved is quite significant.
CAclubindia
