Hi,

Section 135 of Companies Act is applicable to every company  which is having :
• net worth of Rs 500 crore or more; or
• turnover of Rs 1000 crore or more; or
• a net profit of Rs 5 crore or more
during any of the three preceding financial years.

The word used here is ’every company’, However, in terms of rule 6(2) of companies (Incorporation) Rules, 2014, an OPC loses its status if paid-up capital exceeds Rs. 50 lakhs or average annual turnover is more than 2 crores in three immediate preceding consecutive years.

In view of this, it is quite clear that an OPC would not meet the criteria specified in section 135 as detailed above.

Section 24(b) of the Income Tax Act allowed the deduction of Interest paid on money borrowed for the purpose of purchase, repairs, renovation, etc. of house. However,  it is not necessary that the money should have been borrowed as a home loan or from any banking institution.

Interest paid to your friends and relatives in respect of money borrowed for the purposes specified above can also be claimed under section 24(b).

But the actual use of the personal loan should be only for the purpose of the purchase, repairs, renovation, etc. To prove this, the personal loan should be taken through a bank account and the expenditures made for the above purpose and payment of interest should also be made from the bank account.

Financial Year is the year in which the income is earned or say the year of which income-related.

Assessment Year is the year following the financial year in which you have to evaluate the previous year’s income and pay taxes on it.

For example, if the financial year is from 1 April 2020 to 31 March 2021, then it is known as FY 2020-21. The assessment year for this period would begin after the financial year ends – that is from 1 April 2021 to 31 March 2022. Hence, the assessment year would be AY 2022-22.

Resignation is also treated as retirement and section 10(10AA) provides certain exemptions from the amount of leave encashment. This section applies equally to a case of voluntary retirement on account of resignation.

In the following manner it will be exempted:

Resignation by Government Employee:

The full amount of leave encashment is exempted.

Resignation by other employees:

The least of below amount is exempted from income tax:

1. Leave encashment actually received
2. 10 months “average salary”
3. Cash equivalent of unveiled leave (Maximum 30 days leave X Completed Year of service).
4. Maximum Amount as specified by the Govt i.e. Rs. 3,00,000

Here

1. Salary” means “Basic + Dearness Allowance” including commission received if any based on a fixed percentage of turnover.
2. “Average Salary” means the average salary drawn by the employee during the period of 10 months immediately preceding his retirement.

One important thing is to be required to keep in mind that in the above case Maximum limit of Rs 300000 is cumulative means if the employee has availed the exemption of leave encashment received from any one or more employers, then the limit of Rs. 3,00,000 specified above shall be reduced by the amount of exemption availed earlier.