Viability to set off the interest paid ag int received on partner capital

pooja dedhia (Querist) 04 July 2012 This query is : Resolved
a partner has intoduced the capital in his firm of rs 1 lacs @15% p.a. at the year begining.

firm has paid the interest on his capital @12 % as per allowable income tax act 1956.

now partner in his personal return shows the income of the interest on partner s capital under the head "Profit & gain from the business & profession".

he wants to claim the interest paid on the personal loan taken by his capacity against the interest income received on his capital from the firm.

is it diaallowable to claim the interst on the paid against the unsecured loan which is taken by partner in his individual capacity? under which section

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A V Vishal (Expert) 05 July 2012
Firstly Income tax legislation was enacted in 1961 not 1956, secondly the partner may claim st off of interest paid against interest recived.

pooja dedhia (Querist) 05 July 2012
is there maximum limit to claim interest against the interest income recived on the partners capital?

is there a order passeed by the High court in favour of the assessee?

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