Quiz for the week (27 Jul 2026) :
Aryan (P) Ltd had borrowed loan of Rs.15 lakhs from one of the directors (having 25% shareholding in the company) for which interest was paid @15% per annum. The director who advanced money is also engaged in trading activities with the company. So, the company has outstanding sum due from the said director of Rs.30 lakhs on the closing date. In the assessment, the AO mixed up both the ledgers and computed interest receivable /payable by applying the same rate. He not only disallowed the entire interest debit but also, added additionally Rs.2 lakhs as deemed interest due from the director. Is the action of AO tenable in law?
Share your thoughts on or before 03.08.2026.