Interest income for buisness

This query is : Resolved

vivek somani (Querist)
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05 March 2014 hello freinds in case any company doing trading of ny product lend some money in market on interest,will dat interest b treated as pgbp income or other source interest?? and say i hv gp of 2 lac and int incm of 10 lac bt i hv business expenses of say 7 lac..can i show my taxable income as 2+10-7=5 lac ?? hope m clear on my query..

Nikhil Kaushik

Nikhil Kaushik (Expert)
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05 March 2014 to do business of lending money, you should have RBI approval. So it is advisable to show it in other incomes. any loss from business shall be set-off against income from other sources.

vivek somani

vivek somani (Querist)
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13 March 2014 what will be d consequence if loan is given to a sole prop firm of director?

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Nikhil Kaushik

Nikhil Kaushik (Expert)
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13 March 2014 deemed dividend could trigger

vivek somani

vivek somani (Querist)
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13 March 2014 directors having shareholding less then 5 %
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Nikhil Kaushik

Nikhil Kaushik (Expert)
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13 March 2014 then the treatment remain as discussed above in the earlier messages

vivek somani

vivek somani (Querist)
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13 March 2014 just now i got to know

as per section 185 of companies act 2013, company can not give loan to its directors...

Nikhil Kaushik

Nikhil Kaushik (Expert)
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13 March 2014 yes it is so...but for income tax the treatment shall remain same. under companies act you have to worry a lot!

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vivek somani

vivek somani (Querist)
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13 March 2014 In case a sole prop firm invest some money in FD with banks of 7 days several times during the year whenever there is surplus fund available and earns interest on that . will that interest be part of PGBP or other source?