DCIT v. Core Health Care Ltd.

298 ITR 194Supreme Court of India2008#592 most cited

What is DCIT v. Core Health Care Ltd. authority for?

Interest expenditure incurred for acquiring capital assets, even if capitalized in the books, is deductible if for the purpose of business. Section 36(1)(iii) is a self-contained code regarding such deductions.

165

judgments rely on this decision, according to BharatTax’s citation analysis of 367,842 Indian tax judgments — from 2012 to 2026.

Also referred to as

DCIT v. Core Health Care Ltd. · section 36(1)(iii) · interest expenditure · capital asset · business purpose · capitalized interest · revenue expenditure · deduction · tax law

Also reported as

167 Taxmann 206

Sections most often in play

Section 143(3)Section 147Section 148Section 14ASection 142(2A)Section 2(22)(e)Section 40(a)(ia)Section 40A(2)(b)
Read the full judgment

Issues it is cited on

section 40(3)short deduction of tdsinterest on interestclosely held companyshort deduction of taxaccumulated profitsrelated party transactiondisallowance of interest expendituresection 142(2a)section 194jsection 40a(2)(b)section 14a(2)

Judgments citing DCIT v. Core Health Care Ltd.

ACIT, Moradabad vs. M/S Jubliant Organosys Ltd., Uttar Pradesh

The appeal is dismissed

ITA 2596/DEL/2011[2007-08]Status: DisposedITAT Delhi12 Mar 2019AY 2007-08

Bench: Smt Beena A. Pillai & Shri Prashant Maharishi

For Appellant: Shri R.M. Gupta, AdvFor Respondent: Shri J. K. Mishra, CIT DR
Section 115JSection 43(1)

…s, in facts, order of learned CIT – A deleting above addition/disallowance was upheld. Further issue is also squarely covered in favour of assessee by decision of honourable Supreme Court in case of Deputy Commissioner Of Income Tax Vs Core Healthcare Limited 298 ITR 194, CIT vs. Arvind Polycot limited 299 ITR 12 and CIT vs. Sri Rama multi Tech Ltd 393 ITR 371. Therefore respectfully following decision of coordinate bench in case of assessee for earlier year which is on identical facts and circumstances, we confirm order of learned CIT – A and dismiss ground number 8 of appeal of revenue. 19. The ground number 9…

Jubilant Organosys Ltd., Noida vs. Addl. CIT, Moradabad

The appeal is dismissed

ITA 2497/DEL/2011[2007-08]Status: DisposedITAT Delhi12 Mar 2019AY 2007-08

Bench: Smt Beena A. Pillai & Shri Prashant Maharishi

For Appellant: Shri R.M. Gupta, AdvFor Respondent: Shri J. K. Mishra, CIT DR
Section 115JSection 43(1)

…s, in facts, order of learned CIT – A deleting above addition/disallowance was upheld. Further issue is also squarely covered in favour of assessee by decision of honourable Supreme Court in case of Deputy Commissioner Of Income Tax Vs Core Healthcare Limited 298 ITR 194, CIT vs. Arvind Polycot limited 299 ITR 12 and CIT vs. Sri Rama multi Tech Ltd 393 ITR 371. Therefore respectfully following decision of coordinate bench in case of assessee for earlier year which is on identical facts and circumstances, we confirm order of learned CIT – A and dismiss ground number 8 of appeal of revenue. 19. The ground number 9…

The DCIT, Central Circle-1(1), Ahmedabad vs. M/S. Core Health Care Ltd., Ahmedabad

In the result, both the appeals, as also the cross objections, are dismissed

ITA 1800/AHD/2015[2003-04]Status: DisposedITAT Ahmedabad04 Mar 2019AY 2003-04
Section 143(3)Section 36(1)(iii)Section 43B

…rred in law and on facts in deleting the addition of Rs 21,98,50,000 on account of disallowance of interest expenditure which was admittedly a provision and not covered by the decision of Hon’ble Supreme Court in the case of CIT Vs Core Healthcare Ltd [(2008) 298 ITR 194 (SC)]. 4. During the course of reopened scrutiny assessment proceedings, the Assessing Officer noted that the assessee has claimed a deduction of Rs 21,98,50,000 and, in a note to the computation of taxable income, stated that the provision for interest liability of Rs 21,98,50,000 which has accrued but not provided for, is deductible under sect…

Core Health Care Ltd., (Liquidated Company), Ahmedabad vs. The Dy.CIT., .Central Circle-1(1), Ahmedabad

In the result, both the appeals, as also the cross objections, are dismissed

ITA 1409/AHD/2015[2003-04]Status: DisposedITAT Ahmedabad04 Mar 2019AY 2003-04
Section 143(3)Section 36(1)(iii)Section 43B

…rred in law and on facts in deleting the addition of Rs 21,98,50,000 on account of disallowance of interest expenditure which was admittedly a provision and not covered by the decision of Hon’ble Supreme Court in the case of CIT Vs Core Healthcare Ltd [(2008) 298 ITR 194 (SC)]. 4. During the course of reopened scrutiny assessment proceedings, the Assessing Officer noted that the assessee has claimed a deduction of Rs 21,98,50,000 and, in a note to the computation of taxable income, stated that the provision for interest liability of Rs 21,98,50,000 which has accrued but not provided for, is deductible under sect…

Sanghi Infrastructure Ltd., Ahmedabad vs. The Dy.CIT, Circle-8, Ahmedabad

In the result, both the appeals of the assessee are allowed

ITA 942/AHD/2016[2011-12]Status: DisposedITAT Ahmedabad28 Feb 2019AY 2011-12

Bench: Shri Pradip Kumar Kedia & Shri Mahavir Prasad1. आयकर अपील सं./I.T.A. No.2925/Ahd/2015 2. आयकर अपील सं./I.T.A. No.942/Ahd/2016 ("नधा"रण वष" / Assessment Years : 2010-11 & 2011-12 Respectively)

For Respondent: Shri Lalit P.Jain, Sr.DR
Section 271(1)(c)Section 36(1)(iii)

…ment order. 6. The question before us is whether an amount of Rs.93,88,884/- can be added to the income of the assessee or not. In this regard, we draw support from the order of the Hon’ble Supreme Court in the matter of DCIT v/s. Core Healthcare Ltd. (2008) 298 ITR 194 (SC), wherein it is held that interest on borrowed capital to be allowed and makes no distinction between money borrowed to acquire a capital or a revenue asset and section 36(1)(iii) requires that assessee must borrow capital and the purpose of the borrowing must be for business which is carried on by ITA Nos.2925/Ahd/2015 & 942/Ahd/2016 Sanghi…

Sanghi Infrastructure Ltd., Ahmedabad vs. The Dy.CIT, Circle-8, Ahmedabad

In the result, both the appeals of the assessee are allowed

ITA 2925/AHD/2015[2010-11]Status: DisposedITAT Ahmedabad28 Feb 2019AY 2010-11

Bench: Shri Pradip Kumar Kedia & Shri Mahavir Prasad1. आयकर अपील सं./I.T.A. No.2925/Ahd/2015 2. आयकर अपील सं./I.T.A. No.942/Ahd/2016 ("नधा"रण वष" / Assessment Years : 2010-11 & 2011-12 Respectively)

For Respondent: Shri Lalit P.Jain, Sr.DR
Section 271(1)(c)Section 36(1)(iii)

…ment order. 6. The question before us is whether an amount of Rs.93,88,884/- can be added to the income of the assessee or not. In this regard, we draw support from the order of the Hon’ble Supreme Court in the matter of DCIT v/s. Core Healthcare Ltd. (2008) 298 ITR 194 (SC), wherein it is held that interest on borrowed capital to be allowed and makes no distinction between money borrowed to acquire a capital or a revenue asset and section 36(1)(iii) requires that assessee must borrow capital and the purpose of the borrowing must be for business which is carried on by ITA Nos.2925/Ahd/2015 & 942/Ahd/2016 Sanghi…

M/S. Shantikripa Industries Limited, Jaipur vs. Income Tax Officer, Jaipur

In the result, the appeal of the assessee is allowed for statistical

ITA 482/JPR/2018[2012-13]Status: DisposedITAT Jaipur26 Feb 2019AY 2012-13

Bench: Or At The Time Of Hearing.”

For Appellant: Shri S.L. Poddar (Adv.)For Respondent: Shri Anoop Singh (ACIT)

…आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,”B” JAIPUR Jh fot; iky jko] U;kf;d lnL; ,oa Jh foØe flag ;kno] ys[kk lnL; ds le{k BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM vk;dj vihy la-@ITA No. 482/JP/2018 fu/kZkj.k o"kZ@Assessment Year : 2012-13 cuke M/s Shantikripa Industries Limited, The ITO, Vs. Parasrampuria Chamber, Ward- 4(3), Opp. Road No. 1, VKI Area, Jaipur. Jaipur. LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: AAJCS 6656 G vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Shri S.L. Poddar (Adv.) jktLo dh vksj ls…

M/S. Prestige Buildwell Pvt. Ltd., New Delhi vs. ACIT, New Delhi

In the result, all the three appeals of the assesses are allowed

ITA 4772/DEL/2015[2008-09]Status: DisposedITAT Delhi12 Feb 2019AY 2008-09

Bench: Shri R.K. Panda & Shri K. Narasimha Chary

For Appellant: Shri Arun Jain, CAFor Respondent: Shri Sanjay Goyal, CIT DR
Section 143(2)Section 153ASection 57

…he proposition that the interest received by the assessee on his fixed deposits cannot be reduced by the amount of interest paid on the loan taken on security of such deposit as there is no such provision in law, and also DCIT vs. Core Health Care Ltd. (2008) 298 ITR 194 (SC) for the principle that interest on capital borrowed for acquisition of new asset will not be allowed as deduction after the insertion of amended provisions w.e.f. 1.4.2004. According to the assessee, such decisions have no application to the facts of the case. Assessee placed reliance on the decision of the Hon’ble Bombay High Court in the c…

M/S Prestige Buildwell Pvt. Ltd., New Delhi vs. ACIT, New Delhi

In the result, all the three appeals of the assesses are allowed

ITA 3507/DEL/2015[2009-10]Status: DisposedITAT Delhi12 Feb 2019AY 2009-10

Bench: Shri R.K. Panda & Shri K. Narasimha Chary

For Appellant: Shri Arun Jain, CAFor Respondent: Shri Sanjay Goyal, CIT DR
Section 143(2)Section 153ASection 57

…he proposition that the interest received by the assessee on his fixed deposits cannot be reduced by the amount of interest paid on the loan taken on security of such deposit as there is no such provision in law, and also DCIT vs. Core Health Care Ltd. (2008) 298 ITR 194 (SC) for the principle that interest on capital borrowed for acquisition of new asset will not be allowed as deduction after the insertion of amended provisions w.e.f. 1.4.2004. According to the assessee, such decisions have no application to the facts of the case. Assessee placed reliance on the decision of the Hon’ble Bombay High Court in the c…

M/S Mittaso Projects Pvt. Ltd, New Delhi vs. ACIT, New Delhi

In the result, all the three appeals of the assesses are allowed

ITA 3506/DEL/2015[2008-09]Status: DisposedITAT Delhi12 Feb 2019AY 2008-09

Bench: Shri R.K. Panda & Shri K. Narasimha Chary

For Appellant: Shri Arun Jain, CAFor Respondent: Shri Sanjay Goyal, CIT DR
Section 143(2)Section 153ASection 57

…he proposition that the interest received by the assessee on his fixed deposits cannot be reduced by the amount of interest paid on the loan taken on security of such deposit as there is no such provision in law, and also DCIT vs. Core Health Care Ltd. (2008) 298 ITR 194 (SC) for the principle that interest on capital borrowed for acquisition of new asset will not be allowed as deduction after the insertion of amended provisions w.e.f. 1.4.2004. According to the assessee, such decisions have no application to the facts of the case. Assessee placed reliance on the decision of the Hon’ble Bombay High Court in the c…

Triumph Hospitals P.Ltd, Mumbai vs. ITO 7(3)(2), Mumbai

The appeal of the assessee is dismissed

ITA 5735/MUM/2015[2010-11]Status: DisposedITAT Mumbai17 May 2018AY 2010-11

Bench: Shri Joginder Singh & Shri Manoj Kumar Aggarwalassessment Year: 2010-11 Triumph Hospitals Pvt. Ltd. Acit, 801 & 802, Raheja Central Circle-29, बनाम/ Empress, Veer Savarkar Aayakar Bhavan, Vs. Marg, Prabhadevi, M. K. Road, Mumbai-400025 Mumbai-400020 ("नधा"रती /Assessee) (राज"व /Revenue) Pan. No. Aabct4993K

Section 28Section 3Section 36(1)(iii)Section 9

…आयकर अपील"य अ"धकरण, मुंबई "यायपीठ,‘ई’,मुंबई। IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, ‘E’ MUMBAI "ी जो"ग"दर "संह, "या"यक सद"य एवं "ी मनोज कुमार अ"वाल, लेखा सद"य, के सम" Before Shri Joginder Singh, Judicial Member, and Shri Manoj Kumar Aggarwal, Accountant Member Assessment Year: 2010-11 Triumph Hospitals Pvt. Ltd. ACIT, 801 and 802, Raheja Central Circle-29, बनाम/ Empress, Veer Savarkar Aayakar Bhavan, Vs. Marg, Prabhadevi, M. K. Road, Mumbai-400025 Mumbai-400020 ("नधा"रती /Assessee) (राज"व /Revenue) PAN. No. AABCT4993K "नधा"रती क" ओर से / Assessee by Shri Vinay Deshmane राज"व क" ओर से / Revenue by…

M/S. Delhi Gujarat Fleet Carrier, Gurgaon vs. DCIT, Gurgaon

The appeal is dismissed

ITA 1680/DEL/2015[2011-12]Status: DisposedITAT Delhi23 Apr 2018AY 2011-12

Bench: Shri H.S. Sidhu & Shri Prashant Maharishia Y 2011-12 M/S. Delhi Gujarat Fleet Carrier Vs Dcit 1/43, Shivaji Nagar, Circle I(1) Gurgaon Gurgaon (Pan Aaccd6847K) (Appellant) (Respondent)

For Appellant: Sh. Rohit Jain, AdvocateFor Respondent: Ms. Ashima Neb, Sr. DR
Section 143Section 31Section 36Section 36(1)(iii)

…paid from the date of borrowing till the date of those assets first put to use cannot be allowed as deduction. 9. The Ld. AR submitted that such interest could not be disallowed. He relied on the decision of the Hon’ble Supreme Court in 53ITR 140, 26 ITR 471, 298 ITR 194 and the decision of the Hyderabad bench in 110 TTJ 170. It was submitted that the proviso to section 36 (1) (iii) does not apply to the facts of the case. 10. The Ld. DR vehemently supported the order of the Ld. Assessing Officer and CIT (A). 11. We have carefully considered the rival contentions. Admittedly, in this case, the interest paid is o…

ITO, WD-12(3), Kolkata vs. M/S Arpee Builders & Promoters Pvt. Ltd., Kolkata

In the result, appeal of the revenue is partly allowed and the Cross Objection of assessee is dismissed

ITA 303/KOL/2014[2009-2010]Status: DisposedITAT Kolkata05 Feb 2018AY 2009-2010

Bench: "ी जे. सुधाकर रे"डी, लेखा सद"य एवं/And "ी ऐ. ट". वक", "यायीक सद"य) [Before Shri J. Sudhakar Reddy, Am & Shri A. T. Varkey, Jm]

…1 ITA No.303/Kol/2014 & CO No.52/Cal/2014 Arpee Builders & Promoters Pvt. Ltd., AYs- 2009-10 आयकर अपील"य अधीकरण, "यायपीठ – “B” कोलकाता, IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH: KOLKATA (सम")Before "ी जे. सुधाकर रे"डी, लेखा सद"य एवं/and "ी ऐ. ट". वक", "यायीक सद"य) [Before Shri J. Sudhakar Reddy, AM & Shri A. T. Varkey, JM] I.T.A. No. 303/Kol/2014 Assessment Year: 2009-10 Income-tax Officer, Wd-12(3), Kolkata Vs. M/s. Arpee Builders & Promoters Pvt. Ltd. (PAN:AACCA6106C) Appellant Respondent & C.O. 52/Kol/2014 In I.T.A. No. 303/Kol/2014 Assessment Year: 2009-10 M/s. Arpee Builders & Promoters Pvt.Ltd. Vs.…

M/S. Chennai Petroleum Corporation Ltd., Chennai vs. ACIT, Chennai

In the result, both the assessee’s and the Revenue’s appeals are partly allowed and partly allowed for statistical purposes

ITA 1858/CHNY/2011[2004-05]Status: DisposedITAT Chennai05 Dec 2017AY 2004-05

Bench: Shri Sanjay Arora & Shri George Mathanआयकर अपील सं./Ita No.1858/Mds/2011 "नधा"रण वष" / Assessment Year : 2004-05 Chennai Petroleum Corporation Ltd., Asst. Commissioner Of Income Refinery House, Manali, Vs. Tax, Chennai – 600 068 Company Circle-I(3), [Pan: Aaacm 4392C] Chennai – 600 034 (अपीलाथ" /Appellant) (""यथ"/Respondent)

For Appellant: AdvocateFor Respondent: 07.09.2017
Section 143(3)Section 2Section 28Section 36(1)(iii)

…ds rendered as of no consequence in view of the clear language of the provision. The position of law, however, for A.Ys 2004-05 and the subsequent years, is without any shadow of doubt, as clarified by the Apex Court in Dy. CIT v. Core Health Care Ltd. [2008] 298 ITR 194 (SC). The Revenue’s stand is, accordingly, upheld, dismissing the assessee’s ground. We may though add that the Revenue has, capitalizing the interest cost, considered the same for grant of depreciation (refer para II (pg.4) of the assessment order). 4. Gd. 3 raises the issue of computation of the ‘profits of the business’ under Explanation (baa…

DCIT, New Delhi vs. M/S Dlf Ltd., New Delhi

In the result, the appeal of the assessee is partly allowed and the appeal of the Revenue is dismissed

ITA 4342/DEL/2012[2007-08]Status: DisposedITAT Delhi01 Nov 2017AY 2007-08

Bench: Shri B.P. Jain & Shri K.N. Chary.

For Appellant: Shri R.S. Singhvi, CAFor Respondent: Ms. Renu Amitabh, CIT-DR
Section 142Section 143(3)Section 14ASection 250Section 40

…r craft was used for the purpose of trial run and training of pilots. The appellant invited our attention to the relevant details placed at paper book page 102 to 179. The appellant also relied on decision of Supreme Court in the case of Core Health Care Ltd. 298 ITR 194 as per which interest on loan taken for acquisition of capital assets is an allowable deduction u/s. 36(1)(iii) of the Act. 36. The Ld. DR supported the order of Assessing Officer and CIT(A). 37. We have gone through facts of the case, contention of the parties and details placed in the paper book. In our considered opinion, the use of aircrafts…

Dlf Ltd., New Delhi vs. Addl. CIT, New Delhi

In the result, the appeal of the assessee is partly allowed and the appeal of the Revenue is dismissed

ITA 3846/DEL/2012[2007-08]Status: DisposedITAT Delhi01 Nov 2017AY 2007-08

Bench: Shri B.P. Jain & Shri K.N. Chary.

For Appellant: Shri R.S. Singhvi, CAFor Respondent: Ms. Renu Amitabh, CIT-DR
Section 142Section 143(3)Section 14ASection 250Section 40

…r craft was used for the purpose of trial run and training of pilots. The appellant invited our attention to the relevant details placed at paper book page 102 to 179. The appellant also relied on decision of Supreme Court in the case of Core Health Care Ltd. 298 ITR 194 as per which interest on loan taken for acquisition of capital assets is an allowable deduction u/s. 36(1)(iii) of the Act. 36. The Ld. DR supported the order of Assessing Officer and CIT(A). 37. We have gone through facts of the case, contention of the parties and details placed in the paper book. In our considered opinion, the use of aircrafts…

DCIT, New Delhi vs. M/S. Bokaro Power Supply Co. Ltd., New Delhi

In the result, appeal of the assessee is partly allowed whereas the appeal of the Revenue is dismissed

ITA 3692/DEL/2014[2010-11]Status: DisposedITAT Delhi31 Oct 2017AY 2010-11

Bench: Sh. Amit Shukla & Sh. O.P. Kantassessment Year: 2010-11 Vs. Dcit, Circle -3(1), New Delhi M/S. Bokaro Power Supply Co. Ltd., Ispat Bhavan, Lodhi Road, New Delhi Pan : Aabcb8976G (Appellant) (Respondent) & Assessment Year: 2010-11 Vs. M/S. Bokaro Power Supply Co. Dcit, Circle -3(1), New Delhi Ltd., 4Th Floor, Ispat Bhavan, Lodhi Road, New Delhi Pan : Aabcb8976G (Appellant) (Respondent) Assessee By Sh. M.P. Rastogi, Adv. & Sh. Anil Sharma, Agm Respondent By Sh. Sandip Kumar Mishra, Sr.Dr Date Of Hearing 11.10.2017 Date Of Pronouncement 31.10.2017 Order Per O.P. Kant, A.M.:

Section 143(2)Section 143(3)Section 43B

…nection with acquisition of the asset is to be treated as part of actual cost of the asset before the asset is put to use. The Assessing Officer cited the ratio of the judgement of Hon’ble Apex Court in the case of DCIT versus Core Health Care Limited, (2008) 298 ITR 194 (SC) in this regard and accordingly, he disallowed the amount of Rs.48,71,000/-. 7.3 Before the learned CIT-(A), the assessee claimed that in accordance with relevant accounting standards and provisions of section 36(1)(iii) of the Act, the interest expenses of Rs. 471 .39 Lacs relating to the borrowing for the new unit was capitalized and transf…

Bokaro Power Supply Co. Ltd., New Delhi vs. DCIT, New Delhi

In the result, appeal of the assessee is partly allowed whereas the appeal of the Revenue is dismissed

ITA 3405/DEL/2014[2010-11]Status: DisposedITAT Delhi31 Oct 2017AY 2010-11

Bench: Sh. Amit Shukla & Sh. O.P. Kantassessment Year: 2010-11 Vs. Dcit, Circle -3(1), New Delhi M/S. Bokaro Power Supply Co. Ltd., Ispat Bhavan, Lodhi Road, New Delhi Pan : Aabcb8976G (Appellant) (Respondent) & Assessment Year: 2010-11 Vs. M/S. Bokaro Power Supply Co. Dcit, Circle -3(1), New Delhi Ltd., 4Th Floor, Ispat Bhavan, Lodhi Road, New Delhi Pan : Aabcb8976G (Appellant) (Respondent) Assessee By Sh. M.P. Rastogi, Adv. & Sh. Anil Sharma, Agm Respondent By Sh. Sandip Kumar Mishra, Sr.Dr Date Of Hearing 11.10.2017 Date Of Pronouncement 31.10.2017 Order Per O.P. Kant, A.M.:

Section 143(2)Section 143(3)Section 43B

…nection with acquisition of the asset is to be treated as part of actual cost of the asset before the asset is put to use. The Assessing Officer cited the ratio of the judgement of Hon’ble Apex Court in the case of DCIT versus Core Health Care Limited, (2008) 298 ITR 194 (SC) in this regard and accordingly, he disallowed the amount of Rs.48,71,000/-. 7.3 Before the learned CIT-(A), the assessee claimed that in accordance with relevant accounting standards and provisions of section 36(1)(iii) of the Act, the interest expenses of Rs. 471 .39 Lacs relating to the borrowing for the new unit was capitalized and transf…

ITO, New Delhi vs. M/S. Panchkula Finvest (P) Ltd., New Delhi

The appeal of the revenue is dismissed without any cost as prayed for by the Ld AR of the assessee

ITA 2709/DEL/2017[2012-13]Status: DisposedITAT Delhi17 Oct 2017AY 2012-13

Bench: Shri B.P. Jain

For Appellant: Shri P.C. Yadav, AdvFor Respondent: Shri T. Vasanthan Sr. DR
Section 143(3)

…much before the AO. CIT(A) has categorically recorded that the interest has been paid on the basis of clause 4 of the agreement dated 25.05.2010, which fact is not refuted by the ld. DR. d) It is further observed that in the case of Core health reported in 298 ITR 194(SC) Hon’ble Supreme Court has categorically held that interest paid on borrowed capital is allowable under section 36(1)(iii) of the Act and it does not make any difference as to whether the expenses has been incurred in capital filed or revenue filed. It is also a settled position of law that it is prerogative of a businessman to conduct his bus…

M/S. at & T Global Network Services (India) Pvt. Ltd., Gurgaon vs. DCIT, New Delhi

In the result, appeal of the assessee is partly allowed and appeal of the revenue is dismissed

ITA 2538/DEL/2014[2009-10]Status: DisposedITAT Delhi18 Sept 2017AY 2009-10

Bench: Shri I.C.Sudhir & Shri Prashant Maharishiat & T Global Network Services Dcit, (India) Pvt Ltd., Circle-2(1), Vs. Vatika Lok-1, Block-A, Gurgaon New Delhi Pan:Aafca8810L (Appellant) (Respondent) Dcit, At & T Global Network Services Circle-2(1), (India) Pvt Ltd., Vs. New Delhi Vatika Lok-1, Block-A, Gurgaon Pan:Aafca8810L (Appellant) (Respondent)

For Appellant: Shri Kanchan Kaushal, CAFor Respondent: Shri N C Swain CIT DR
Section 143(3)Section 144CSection 144C(5)Section 32Section 36

…thereby not falling under the purview of proviso to section 36(1)(iii) of the Act has no applicability to appellant‗s case. 1.14 In this regard, reliance is also placed on the decision of the Hon‘ble Supreme Court in the case of CIT vs. Core Health Care Ltd (298 ITR 194)(SC) wherein it has been held that Section 36(1)(iii) makes no distinction between capital borrowed for revenue or capital purposes. Any expenditure incurred in respect of capital borrowed for the purpose of business shall be allowed deduction. Similar observation has been made by the Apex Court in the case of United Phosphorous Limited (299 ITR…