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IT ACT,'61-FOREIGN FUNDS RECD N CREDITED TO CURRENT ACCOUNT

(Querist) 04 August 2009 This query is : Resolved 
An Individual carrying on proprietory concern received money through proper channel,from son who works in foreign,and credited the same to firm's current account. Whether this amount is exempt? If not, what will be the consequences? Pls clarify as early as possible.
A V Vishal (Expert) 07 August 2009
You have an incomplete query, you have not stated why the amount is sent by the son into the father's account. In such case it will be difficult to guage the intention of the sender and the taxability thereof.
BH. SREENIVAS (Querist) 08 August 2009
Sir,
Thanks for ur concern. Son has been a creditor in the firm's books before his leaving India. The proprietorhas been paying interest regularly. Son sent some amount to the assessee which is credited in current a/c of the firm. Will it make any difference if it is credited to SB a/c? Can it be treated as gift or loan? If treated as loan, what are the consequences of interest part both to payer and payee under the IT Act and FEMA, pls clarify- urgent.


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