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Sale proceeds to unsecured loan

Raman Singla (Accounts Services) (167 Points)

29 December 2019

Can we reduce the liability of unsecured loan in books (maintained under section 44ab) through sale proceeds with mutual consent ????

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6 Replies

RAJA P M ("Do the Right Thing...!!!") (128106 Points)
Replied 29 December 2019

Yes.... If You are make sale/supply for the party then You can reduce the loan amount if you are received them...

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Raman Singla (Accounts Services) (167 Points)
Replied 29 December 2019

Loan amount is opening balance in the books says 40 lac....
loan amount paid via check 7 lac
and via sale 15 lac

closing balance 18 lac

RAJA P M ("Do the Right Thing...!!!") (128106 Points)
Replied 29 December 2019

Yes... You can.

Consider any interest payable as per Your understanding...

Kapadia Pravin (17264 Points)
Replied 29 December 2019

You can adjust amount of sale proceeds against unsecured loan amount payable by you.

Pay interest as per terms. it's deductible as expenditure.

Pay minimum 9% interest . otherwise lender will have to pay deemed interest income say 4% if you pay interest @ 5% (notional interest).