Hi Mukesh,
If i have understood you correctly, a proprietorship unit (proprietor "P") want to take interest free loan from:-
(a) P's relative ("R"), in its individual capacity,
(b) a firm in which R is a partner.
No amount of justifications / documentations will absolve P from escaping provisions of the Income Tax Act, 1961, in being assessed for "unexplained credits". It also depends on the tax track records (financial capability) of P and R, to what extent it comes down heavily on P and / or R.
Reason is quite simple, nothing is free in today's world. So, if a loan is given free then there is definitely something else which is being hid - like interest is actually payable but in "cash", or it is actually sale of some assets but instead of booking the sale proceeds (and the consequent offering taxable income out of such sale), which is shown as interest free loan.
Hence, advisable to avoid such transactions to attract attention of tax authorities for peanuts.
Best Regards,
CA SUDHIR G AGRAWAL
SUDHIR G AGRAWAL & ASSOCIATES
CHARTERED ACCOUNTANTS
CDMA: + 91 9372437923
GSM: + 91 7620337923
GSM: + 91 9175082939
Skype ID: casudhiragrawal
URL: http://sudhirgagrawalassociates.icai.org.in/
Disclaimer: This electronic message transmission contains information which is legally confidential and / or privileged. The information is intended to be for the sole use of the individual(s) or entity / entities named above. This email message does not and is not intended to constitute an investment advice or propagating a scheme or investment plan of any nature whatsoever. Further, the contents herein does not and is not intended to constitute either solicitation of investment, or an offer to sell, or an offer to buy securities of any nature whatsoever. If you are not the intended recipient, beware that any use, disclosure, copy, distribution or re-transmission of the contents, whether in part(s) or not, of this information / document(s) is strictly prohibited. If you have received the electronic transmission in error please notify us immediately by return e-mail without retaining any soft copy on any media or hard print outs etc and to destroy the original e-mail communication, including all attachments, in their entirety.
CA SUDHIR G AGRAWAL
SUDHIR G AGRAWAL & ASSOCIATES
CHARTERED ACCOUNTANTS
CDMA: + 91 9372437923
GSM: + 91 7620337923
GSM: + 91 9175082939
Skype ID: casudhiragrawal
URL: http://sudhirgagrawalassociates.icai.org.in/
Disclaimer: This electronic message transmission contains information which is legally confidential and / or privileged. The information is intended to be for the sole use of the individual(s) or entity / entities named above. This email message does not and is not intended to constitute an investment advice or propagating a scheme or investment plan of any nature whatsoever. Further, the contents herein does not and is not intended to constitute either solicitation of investment, or an offer to sell, or an offer to buy securities of any nature whatsoever. If you are not the intended recipient, beware that any use, disclosure, copy, distribution or re-transmission of the contents, whether in part(s) or not, of this information / document(s) is strictly prohibited. If you have received the electronic transmission in error please notify us immediately by return e-mail without retaining any soft copy on any media or hard print outs etc and to destroy the original e-mail communication, including all attachments, in their entirety.
On Fri, Aug 1, 2014 at 12:50 AM, Mukesh Katara mukeshkatara@gmail.com [aaykarbhavan] <aaykarbhavan@yahoogroups.com> wrote:
Whether a relative can give interest free loan to the proprietorship concern of relative...and one more if firm given imterest free loan to proprietorship ...pls explain with income tax act.
Thanking you
Mukesh katara
9979743486
__._,_.___
Posted by: Sudhir G Agrawal <casudhiragrawal@gmail.com>
receive alert on mobile, subscribe to SMS Channel named "aaykarbhavan"
[COST FREE]
SEND "on aaykarbhavan" TO 9870807070 FROM YOUR MOBILE.
To receive the mails from this group send message to aaykarbhavan-subscribe@yahoogroups.com
__,_._,___
No comments:
Post a Comment