Lenders licence required or not

Sir
when anybody gives loan to a firm or pvt company by cheque, as per IT law the firm claims deduction of interest at 12-15%, and lender gets interest.
Now as per law when you give money and charge interest then he has to get the lender's licence from govt.
Then taking interest is legal or not
Replies (3)
Quick Summary
This discussion clarifies whether a lender's licence is required when providing loans to private companies or individuals, especially when interest is charged. The consensus is that a licence is generally not needed for individuals making an investment, as long as they declare the interest income in their tax return. The focus is on distinguishing between an investment and a business activity requiring formal licensing.

License is not required to individual who is not doing such business. It can be just investment. He/she has to declare the interest income in relevant ITR.

👍thanks

You are welcome.           

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