Tds on interest paid to minor

I think the problem lies with the minor giving a loan.

I recommend you that you ask in the LAW section of this forum, that whether a minor or his guardian, on behalf of minor, can grant a loan to someone or not.

In my opinion a minor cannot grant loan.

scavanger007 is right, the problem is in, whether a minor can give loan.

Income tax act is silent about that.

But in income tax any one can apply for PAN, even a minor also.

And it's a duty of person to deduct TDS at the time of making payment.

So Mr X is liable to deduct TDS at the prsecribed rate, and if minor has no PAN, then at maximum rate.

Now question of Aggreagation on income, under the law, income or loss of a person  is aggreagated in the income of other person. But nothing is said about the, TDS deducted is also clubbed.

Hence it may assumed that the provisions are also applicable to the TDS deductions.

Hence Mr X is eligible for the benefit of the clubbing of income and tds deducted.

ohter question may arise, Both are relatives.

But the main question still presist, whether the minor can enter in an agreement to give loan .