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Vishwajeet   27 July 2015

Home loan & its legal use ?

I have enhnanced my home loan to get loan for the registry of the house. If I register by 31st July'2015, I have to pay 6,50,000/- as stamp duty + Registration Fee in (Ghaziabad, UP). This approved amount I will be getting in a weeks time from the bank. Can I take loan from my 14 friends for few days (3 to4 days) say, 14 X 49,000/- = 6,86,000/- and pay towards Stamp + Registration fee. Later when I get 6,50,000/- from bank, I will returns them. I am not having any written agrrement with my friend and no intrest is to be paid to them. Is this legally correct from Income Tax point of view ? Is there any problem for me or my friends ?


 2 Replies

G.L.N. Prasad (Retired employee.)     28 July 2015

Only a tax practioner can guide you properly in this matter.  However, a separate account (other than existing one may be opened) with borrowing Bank, after intimating them your difficulty.  Accept crossed cheques only into the account.  Pay the amount through cheque/demand draft to the Builder obtained from the same branch .  Do not operate the account further.


Another way is asking your friends to deposit that amount in their individual name in the same branch.  Avail a deposit loan/Overdraft and pay the amount through demand draft to Builder.  Inform that in view of the escalation in stamp duty, and as the loan formalities require time, you are constrained to raise deposit loan and get the Registration, and request the bank to credit the amount to the loan/overdraft acount.

Close both accounts immediately after the purpose is served.  There is no difficulty for you, but your friends should have proper account for the money being given to you.  Most important thing is that your Bank should accept for this arrangement.  If loan is not sanctioned, what has to be done has also to be considered.

Suneet Gupta (www.vashiadvocates.com)     31 July 2015

Dear Sir, you can take a friendly loan from a Friend and return it to him at the earliest. There will be no issue in this from the Legal or Tax point of view. If your transaction is clean, then you do not need to fear the Income Tax authorities and can clearly give evidence of the temporary requirement of loan.

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