S. 40A(2)(b) Loan taken from relatives cannot be compared with bank loan

The ld. Counsel of the assessee filed a copy of the decision of the ITAT, Ahmedabad ‘A’ Bench dated 09.07.10 in the case of Vipul Y. Mehta-vs- ACIT in ITA No. 869/Ahd/2010 for the assessment year 2007-08 wherein it was held that loan taken from the relatives cannot be compared with bank loan because loan from the relatives are without security, while loan from the bank is secured. In this decision, reliance was also placed in the decision of the Tribunal in the case of Omkarmal Gaurishanker –Vs- ITO reported in 92 TTJ (Ahd.) 223 wherein it was held that interest paid to relatives @24% is...