A LOAN IS GRANTED INTEREST FREE BY A TO B.
IS REAPYMENT OF LOAN ALONE IN THIS CASE VALID CONSIDERATION OF SUCH A CONTRACT?
HOW DOES ANY INTEREST FREE LOAN DIFFER FROM GIFT?
ca.bhupendrashah (FCADISA) 16 November 2008
A LOAN IS GRANTED INTEREST FREE BY A TO B.
IS REAPYMENT OF LOAN ALONE IN THIS CASE VALID CONSIDERATION OF SUCH A CONTRACT?
HOW DOES ANY INTEREST FREE LOAN DIFFER FROM GIFT?
K.C.Suresh (Advocate) 17 November 2008
Gift involves an indivdual element but laon has a business one. Is it prof. ?
N.K.Assumi (Advocate) 17 November 2008
I agree with Suresh Ji.
Manish Singh (Advocate) 17 November 2008
this is quite interesting point of law and even the bare act says that consideration must be a kind of benefecial for a promisor.
we all know that this is a valid contract in the eyes of law and we can enforce it to claim our money back but how it could it be a valid contract without consideration....? please pour in your views..
ca.bhupendrashah (FCADISA) 18 November 2008
true
ca.bhupendrashah (FCADISA) 18 November 2008
also refer section 56[2][v] of Income tax for that purpose.
ca.bhupendrashah (FCADISA) 18 November 2008
gift needs acceptance , declaration & is covered u/s 25 of contract act
Manish Singh (Advocate) 19 November 2008
gift is a different kind of contract where revocation becomes almost impossible. but what clarification we would giv in the abpve case.
ca.bhupendrashah (FCADISA) 20 November 2008
tax dept says "any sum recd without consideration" can also mean interest free loans too !!!!!!!!!!!!!!!!!!!!!!!!!!
ca.bhupendrashah (FCADISA) 20 November 2008
FM speech is clear that it means purported gifts. but act is vague !!!!!!!!!!!!!!
Manish Singh (Advocate) 25 November 2008
I agree but the point is how could we validate the transaction in terms of the Contrcat ACT where consideration must be there except in few cases.
Manish Singh (Advocate) 27 November 2008
But again the contract act is not regulated by the provisions of IT Act so we need to go by the Contract act and according to the act there must a consideration form a valid contract
ca.bhupendrashah (FCADISA) 27 November 2008
repayment itsef is gd consideration.
TVD Rajkumar (Advocate) 08 December 2008
IS REAPYMENT OF LOAN ALONE IN THIS CASE VALID CONSIDERATION OF SUCH A CONTRACT?
Hope Iam not off topic... why go to the extent of repayment is just a promise to repay ("promise to do"), not act as consideration (S. 2 (d)) ??
TVD Rajkumar (Advocate) 08 December 2008
"this is quite interesting point of law and even the bare act says that consideration must be a kind of benefecial for a promisor."
This I believe is not correct. You are probably referring to some judgements like Sonia Bhatia Vs St of UP AIR 1981 SC 1274
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