Loan to an individual or firm

Divya Garg (Director) (178 Points)

11 July 2014  

Hi All,

if someone is a salaried employee with good amount savings every month and from that savings he is giving interest free unsecured loan to his friends/relatives and proprietership firms but parallel to that he is also taking home loan from SBI on interest.  

 

Is this acceptable to Income tax department ? On one hand he is lending his money to someone without interest and on other hand he is raising loan from bank. 

 

Let me know.

 

Regards,

Divya