Interest on term loan

yash007 (Querist) 13 June 2012 This query is : Resolved
The assessee has taken term loan from Bank and also enjoying overdraft facility with same bank, now loan is taken for business and OD also for business, then can assessee made payment of term loan from OD account? AND is the both interest deductible under IT Act 1963?

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Shonee Kapoor (Expert) 14 June 2012
Yes, he can pay the same from OD account.

Interest is deductable under IT Act.

Regards,

Shonee Kapoor
harassed.by.498a@gmail.com

Vineet (Expert) 15 June 2012
yes very much. The OD funds are being used to retire existing debt, hence interest charged in both accounts is tax deductible.

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