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“interest on interest”

InterestSection 244ASection 244A238 judgments

The decision most relied on for interest on interest is Malabar Industrial Co. Ltd. v. CIT (243 ITR 83), cited in 2,943 judgments on BharatTax.

Leading authorities on interest on interest

Malabar Industrial Co. Ltd. v. CIT
243 ITR 83 · 2000 · Supreme Court
2,943
citing judgments

For revision under Section 263, the Assessing Officer's order must be both erroneous and prejudicial to the interests of the revenue; if either condition is not met, the revisionary jurisdiction cannot be invoked. An order is not erroneous merely because the Assessing Officer did not record the details of enquiries conducted, provided due enquiries were made.

CIT v. Reliance Utilities & Power Ltd.
313 ITR 340 · 2009 · High Court
2,118
citing judgments

Where an assessee claims that investments were made out of own funds, interest disallowance under Section 14A read with Rule 8D may not apply if the assessee demonstrates the availability of sufficient interest-free funds to cover such investments.

S.A. Builders Ltd. v. CIT
288 ITR 1 · 2007 · Supreme Court
1,484
citing judgments

Interest paid on borrowed funds cannot be disallowed merely because the assessee made interest-free advances, provided those advances were made for business purposes and commercial expediency. The Revenue cannot dictate a businessman's commercial decisions, but the assessee bears the onus to prove the business expediency.

Totgars Co-operative Sale Society Ltd. v. ITO
322 ITR 283 · 2010 · Supreme Court
1,283
citing judgments

The interest income earned by a cooperative society from investing its surplus funds in fixed deposits with banks is not "derived from" its eligible business activities and is taxable as "income from other sources" under Section 56, thus not qualifying for deduction under Section 80P.

CIT v. HDFC Bank Ltd.
366 ITR 505 · 2014 · High Court
1,261
citing judgments

When an assessee possesses interest-free funds sufficient to cover investments yielding tax-free income, it is presumed that such investments were made from these interest-free funds, precluding disallowance of interest expenditure under Section 14A.

Godrej & Boyce Mfg. Co. Ltd. v. DCIT
328 ITR 81 · 2010 · High Court
1,183
citing judgments

Rule 8D, for computing disallowance under Section 14A for expenses related to exempt income, applies from Assessment Year 2008-09 onwards; for prior years, a reasonable disallowance must be made. The disallowance under Section 14A cannot exceed the actual exempt income earned.

CIT v. Max India Ltd.
295 ITR 282 · 2007 · Supreme Court
1,162
citing judgments

Under Section 263, an assessment order is not erroneous and prejudicial to the interest of the revenue merely because the Principal Commissioner disagrees with the Assessing Officer's (AO) view, particularly if the AO has adopted one of two permissible views in law, unless that view is completely unsustainable. If due inquiries were made, the AO's order does not become erroneous solely because the fact of inquiries was not recorded.

Pr. CIT v. Totagars
395 ITR 611 · 2017 · High Court
1,074
citing judgments

Interest income earned by a cooperative society from surplus deposits or investments held with a cooperative bank is not eligible for deduction under Section 80P(2)(d) of the Act.

Judgments citing interest on interest

Ipca Laboratories Ltd, Mumbai vs. DCIT (Ltu), Mumbai

In the result, appeal filed by the learned assessing officer is dismissed

ITA 3267/MUM/2012[2007-08]Status: DisposedITAT Mumbai29 Aug 2022AY 2007-08

Bench: Shri Prashant Maharishi, Am & Shri Pavan Kumar Gadale, Jm

For Appellant: Shri F.V. Irani, ARFor Respondent: Shri Sumit Kumar, DR
Section 801BSection 801CSection 80ISection 92C

reason that assessee was not free to price its products at Arm’s Length Price. iii. With respect to the interest on interest free advances given to the subsidiary companies, he upheld the action of the learned Transfer Pricing Officer but determines the rate of interest ... ground number 1 of the appeal to that extent is dismissed. 029. With respect to second transfer pricing adjustments because of interest on interest free advances charged at 8.25%, the learned Authorized Representative submitted that these loans are given earlier years. He submitted that these

Cifco Finance Ltd., Mumbai vs. ACIT (OSD II) Cir.7, Mumbai

In the result all 16 appeals related to the assessee are disposed off

ITA 6147/MUM/2011[2008-09]Status: DisposedITAT Mumbai29 Aug 2022AY 2008-09

Bench: The Income Tax Appellate Tribunal C Bench Mumbai Before Sri Amit Shukla J M & Prashant Maharishi Am In The Matter Of Cifco Finance Limited, [ Aaacc1765F] Bhupen Chambers, Dalal Street, Mumbai V The Asst Commissioner Of Income Tax Aykar Bhavan 4Th Floor , M K Road Mumbai 20

Section 143Section 147Section 271

claimed a short-term capital loss of ₹ 397,451/–. As the securities were purchased including interest and now sold including interest, no interest was received by the assessee during this year, which was shown as income in assessment year 1998 – 1999, write was claimed as deduction ... outstanding interest, which is already been offered by the assessee for taxation, there is no provision of charging of interest on interest, and there is no advanced given by the assessee out of interest-bearing funds. Therefore for the similar reasons we delete the addition

Cifco Finance Ltd., Mumbai vs. ACIT (OSD II) Cir.7, Mumbai

In the result all 16 appeals related to the assessee are disposed off

ITA 6146/MUM/2011[2007-08]Status: DisposedITAT Mumbai29 Aug 2022AY 2007-08

Bench: The Income Tax Appellate Tribunal C Bench Mumbai Before Sri Amit Shukla J M & Prashant Maharishi Am In The Matter Of Cifco Finance Limited, [ Aaacc1765F] Bhupen Chambers, Dalal Street, Mumbai V The Asst Commissioner Of Income Tax Aykar Bhavan 4Th Floor , M K Road Mumbai 20

Section 143Section 147Section 271

claimed a short-term capital loss of ₹ 397,451/–. As the securities were purchased including interest and now sold including interest, no interest was received by the assessee during this year, which was shown as income in assessment year 1998 – 1999, write was claimed as deduction ... outstanding interest, which is already been offered by the assessee for taxation, there is no provision of charging of interest on interest, and there is no advanced given by the assessee out of interest-bearing funds. Therefore for the similar reasons we delete the addition

Ipca Laboratories Ltd, Mumbai vs. ACIT (Ltu), Mumbai

In the result, appeal filed by the learned assessing officer is dismissed

ITA 8120/MUM/2010[2005-06]Status: DisposedITAT Mumbai29 Aug 2022AY 2005-06

Bench: Shri Prashant Maharishi, Am & Shri Pavan Kumar Gadale, Jm

For Appellant: Shri F.V. Irani, ARFor Respondent: Shri Sumit Kumar, DR
Section 801BSection 801CSection 80ISection 92C

reason that assessee was not free to price its products at Arm’s Length Price. iii. With respect to the interest on interest free advances given to the subsidiary companies, he upheld the action of the learned Transfer Pricing Officer but determines the rate of interest ... ground number 1 of the appeal to that extent is dismissed. 029. With respect to second transfer pricing adjustments because of interest on interest free advances charged at 8.25%, the learned Authorized Representative submitted that these loans are given earlier years. He submitted that these

Ipca Laboratories Ltd, Mumbai vs. DCIT (Ltu), Mumbai

In the result, appeal filed by the learned assessing officer is dismissed

ITA 8084/MUM/2010[2006-07]Status: DisposedITAT Mumbai29 Aug 2022AY 2006-07

Bench: Shri Prashant Maharishi, Am & Shri Pavan Kumar Gadale, Jm

For Appellant: Shri F.V. Irani, ARFor Respondent: Shri Sumit Kumar, DR
Section 801BSection 801CSection 80ISection 92C

reason that assessee was not free to price its products at Arm’s Length Price. iii. With respect to the interest on interest free advances given to the subsidiary companies, he upheld the action of the learned Transfer Pricing Officer but determines the rate of interest ... ground number 1 of the appeal to that extent is dismissed. 029. With respect to second transfer pricing adjustments because of interest on interest free advances charged at 8.25%, the learned Authorized Representative submitted that these loans are given earlier years. He submitted that these

ACIT Cen Cir 13, Mumbai vs. Ipca Laboratories Ltd, Mumbai

In the result, appeal filed by the learned assessing officer is dismissed

ITA 7511/MUM/2010[2005-06]Status: DisposedITAT Mumbai29 Aug 2022AY 2005-06

Bench: Shri Prashant Maharishi, Am & Shri Pavan Kumar Gadale, Jm

For Appellant: Shri F.V. Irani, ARFor Respondent: Shri Sumit Kumar, DR
Section 801BSection 801CSection 80ISection 92C

reason that assessee was not free to price its products at Arm’s Length Price. iii. With respect to the interest on interest free advances given to the subsidiary companies, he upheld the action of the learned Transfer Pricing Officer but determines the rate of interest ... ground number 1 of the appeal to that extent is dismissed. 029. With respect to second transfer pricing adjustments because of interest on interest free advances charged at 8.25%, the learned Authorized Representative submitted that these loans are given earlier years. He submitted that these

Cifco Finance Ltd, Mumbai vs. ACIT (OSD-II) Cr 7, Mumbai

In the result all 16 appeals related to the assessee are disposed off

ITA 6075/MUM/2009[2006-07]Status: DisposedITAT Mumbai29 Aug 2022AY 2006-07

Bench: The Income Tax Appellate Tribunal C Bench Mumbai Before Sri Amit Shukla J M & Prashant Maharishi Am In The Matter Of Cifco Finance Limited, [ Aaacc1765F] Bhupen Chambers, Dalal Street, Mumbai V The Asst Commissioner Of Income Tax Aykar Bhavan 4Th Floor , M K Road Mumbai 20

Section 143Section 147Section 271

claimed a short-term capital loss of ₹ 397,451/–. As the securities were purchased including interest and now sold including interest, no interest was received by the assessee during this year, which was shown as income in assessment year 1998 – 1999, write was claimed as deduction ... outstanding interest, which is already been offered by the assessee for taxation, there is no provision of charging of interest on interest, and there is no advanced given by the assessee out of interest-bearing funds. Therefore for the similar reasons we delete the addition

Cifco Finance Ltd, Mumbai vs. ACIT (OSD II), Cr 7, Mumbai

In the result all 16 appeals related to the assessee are disposed off

ITA 1919/MUM/2009[2005-2006]Status: DisposedITAT Mumbai29 Aug 2022AY 2005-2006

Bench: The Income Tax Appellate Tribunal C Bench Mumbai Before Sri Amit Shukla J M & Prashant Maharishi Am In The Matter Of Cifco Finance Limited, [ Aaacc1765F] Bhupen Chambers, Dalal Street, Mumbai V The Asst Commissioner Of Income Tax Aykar Bhavan 4Th Floor , M K Road Mumbai 20

Section 143Section 147Section 271

claimed a short-term capital loss of ₹ 397,451/–. As the securities were purchased including interest and now sold including interest, no interest was received by the assessee during this year, which was shown as income in assessment year 1998 – 1999, write was claimed as deduction ... outstanding interest, which is already been offered by the assessee for taxation, there is no provision of charging of interest on interest, and there is no advanced given by the assessee out of interest-bearing funds. Therefore for the similar reasons we delete the addition

M/A. Cifco Finance Ltd, Mumbai vs. The ACIT (OSD II) Cr-7, Mumbai

In the result all 16 appeals related to the assessee are disposed off

ITA 490/MUM/2008[2004-2005]Status: DisposedITAT Mumbai29 Aug 2022AY 2004-2005

Bench: The Income Tax Appellate Tribunal C Bench Mumbai Before Sri Amit Shukla J M & Prashant Maharishi Am In The Matter Of Cifco Finance Limited, [ Aaacc1765F] Bhupen Chambers, Dalal Street, Mumbai V The Asst Commissioner Of Income Tax Aykar Bhavan 4Th Floor , M K Road Mumbai 20

Section 143Section 147Section 271

claimed a short-term capital loss of ₹ 397,451/–. As the securities were purchased including interest and now sold including interest, no interest was received by the assessee during this year, which was shown as income in assessment year 1998 – 1999, write was claimed as deduction ... outstanding interest, which is already been offered by the assessee for taxation, there is no provision of charging of interest on interest, and there is no advanced given by the assessee out of interest-bearing funds. Therefore for the similar reasons we delete the addition

M/S. Cifco Finance Ltd., Mumbai vs. ACIT (OSD-II) Cr.-7, Mumbai

In the result all 16 appeals related to the assessee are disposed off

ITA 5462/MUM/2006[2003-2004]Status: DisposedITAT Mumbai29 Aug 2022AY 2003-2004

Bench: The Income Tax Appellate Tribunal C Bench Mumbai Before Sri Amit Shukla J M & Prashant Maharishi Am In The Matter Of Cifco Finance Limited, [ Aaacc1765F] Bhupen Chambers, Dalal Street, Mumbai V The Asst Commissioner Of Income Tax Aykar Bhavan 4Th Floor , M K Road Mumbai 20

Section 143Section 147Section 271

claimed a short-term capital loss of ₹ 397,451/–. As the securities were purchased including interest and now sold including interest, no interest was received by the assessee during this year, which was shown as income in assessment year 1998 – 1999, write was claimed as deduction ... outstanding interest, which is already been offered by the assessee for taxation, there is no provision of charging of interest on interest, and there is no advanced given by the assessee out of interest-bearing funds. Therefore for the similar reasons we delete the addition

M/S. Cifco Finance Ltd., Mumbai vs. ACIT (OSD-II) Cr-7, Mumbai

In the result all 16 appeals related to the assessee are disposed off

ITA 2499/MUM/2006[2002-2003]Status: DisposedITAT Mumbai29 Aug 2022AY 2002-2003

Bench: The Income Tax Appellate Tribunal C Bench Mumbai Before Sri Amit Shukla J M & Prashant Maharishi Am In The Matter Of Cifco Finance Limited, [ Aaacc1765F] Bhupen Chambers, Dalal Street, Mumbai V The Asst Commissioner Of Income Tax Aykar Bhavan 4Th Floor , M K Road Mumbai 20

Section 143Section 147Section 271

claimed a short-term capital loss of ₹ 397,451/–. As the securities were purchased including interest and now sold including interest, no interest was received by the assessee during this year, which was shown as income in assessment year 1998 – 1999, write was claimed as deduction ... outstanding interest, which is already been offered by the assessee for taxation, there is no provision of charging of interest on interest, and there is no advanced given by the assessee out of interest-bearing funds. Therefore for the similar reasons we delete the addition

M/S. Cifco Finance Ltd., Mumbai vs. ACIT (OSD-II) Cr-7, Mumbai

In the result all 16 appeals related to the assessee are disposed off

ITA 2498/MUM/2006[2001-2002]Status: DisposedITAT Mumbai29 Aug 2022AY 2001-2002

Bench: The Income Tax Appellate Tribunal C Bench Mumbai Before Sri Amit Shukla J M & Prashant Maharishi Am In The Matter Of Cifco Finance Limited, [ Aaacc1765F] Bhupen Chambers, Dalal Street, Mumbai V The Asst Commissioner Of Income Tax Aykar Bhavan 4Th Floor , M K Road Mumbai 20

Section 143Section 147Section 271

claimed a short-term capital loss of ₹ 397,451/–. As the securities were purchased including interest and now sold including interest, no interest was received by the assessee during this year, which was shown as income in assessment year 1998 – 1999, write was claimed as deduction ... outstanding interest, which is already been offered by the assessee for taxation, there is no provision of charging of interest on interest, and there is no advanced given by the assessee out of interest-bearing funds. Therefore for the similar reasons we delete the addition

M/S. Cifco Finance Ltd., Mumbai vs. ACIT (OSD-II) Cr-7, Mumbai

In the result all 16 appeals related to the assessee are disposed off

ITA 2497/MUM/2006[2000-2001]Status: DisposedITAT Mumbai29 Aug 2022AY 2000-2001

Bench: The Income Tax Appellate Tribunal C Bench Mumbai Before Sri Amit Shukla J M & Prashant Maharishi Am In The Matter Of Cifco Finance Limited, [ Aaacc1765F] Bhupen Chambers, Dalal Street, Mumbai V The Asst Commissioner Of Income Tax Aykar Bhavan 4Th Floor , M K Road Mumbai 20

Section 143Section 147Section 271

claimed a short-term capital loss of ₹ 397,451/–. As the securities were purchased including interest and now sold including interest, no interest was received by the assessee during this year, which was shown as income in assessment year 1998 – 1999, write was claimed as deduction ... outstanding interest, which is already been offered by the assessee for taxation, there is no provision of charging of interest on interest, and there is no advanced given by the assessee out of interest-bearing funds. Therefore for the similar reasons we delete the addition

M/S. Cifco Finance Ltd., Mumbai vs. ACIT (OSD-II) Cr-7, Mumbai

In the result all 16 appeals related to the assessee are disposed off

ITA 2496/MUM/2006[1999-2000]Status: DisposedITAT Mumbai29 Aug 2022AY 1999-2000

Bench: The Income Tax Appellate Tribunal C Bench Mumbai Before Sri Amit Shukla J M & Prashant Maharishi Am In The Matter Of Cifco Finance Limited, [ Aaacc1765F] Bhupen Chambers, Dalal Street, Mumbai V The Asst Commissioner Of Income Tax Aykar Bhavan 4Th Floor , M K Road Mumbai 20

Section 143Section 147Section 271

claimed a short-term capital loss of ₹ 397,451/–. As the securities were purchased including interest and now sold including interest, no interest was received by the assessee during this year, which was shown as income in assessment year 1998 – 1999, write was claimed as deduction ... outstanding interest, which is already been offered by the assessee for taxation, there is no provision of charging of interest on interest, and there is no advanced given by the assessee out of interest-bearing funds. Therefore for the similar reasons we delete the addition

The ACIT (OSD-II) Cen RG-7, Mumbai vs. M/S. Cifco Finance Ltd, Mumbai

In the result all 16 appeals related to the assessee are disposed off

ITA 2341/MUM/2006[2000-2001]Status: DisposedITAT Mumbai29 Aug 2022AY 2000-2001

Bench: The Income Tax Appellate Tribunal C Bench Mumbai Before Sri Amit Shukla J M & Prashant Maharishi Am In The Matter Of Cifco Finance Limited, [ Aaacc1765F] Bhupen Chambers, Dalal Street, Mumbai V The Asst Commissioner Of Income Tax Aykar Bhavan 4Th Floor , M K Road Mumbai 20

Section 143Section 147Section 271

claimed a short-term capital loss of ₹ 397,451/–. As the securities were purchased including interest and now sold including interest, no interest was received by the assessee during this year, which was shown as income in assessment year 1998 – 1999, write was claimed as deduction ... outstanding interest, which is already been offered by the assessee for taxation, there is no provision of charging of interest on interest, and there is no advanced given by the assessee out of interest-bearing funds. Therefore for the similar reasons we delete the addition

ACIT (OSD-II) Cent. RG. - 7, Mumbai vs. M/S. Cifco Finance Ltd., Mumbai

In the result all 16 appeals related to the assessee are disposed off

ITA 2323/MUM/2006[1999-2000]Status: DisposedITAT Mumbai29 Aug 2022AY 1999-2000

Bench: The Income Tax Appellate Tribunal C Bench Mumbai Before Sri Amit Shukla J M & Prashant Maharishi Am In The Matter Of Cifco Finance Limited, [ Aaacc1765F] Bhupen Chambers, Dalal Street, Mumbai V The Asst Commissioner Of Income Tax Aykar Bhavan 4Th Floor , M K Road Mumbai 20

Section 143Section 147Section 271

claimed a short-term capital loss of ₹ 397,451/–. As the securities were purchased including interest and now sold including interest, no interest was received by the assessee during this year, which was shown as income in assessment year 1998 – 1999, write was claimed as deduction ... outstanding interest, which is already been offered by the assessee for taxation, there is no provision of charging of interest on interest, and there is no advanced given by the assessee out of interest-bearing funds. Therefore for the similar reasons we delete the addition

Giraffe Developers Pvt. Ltd., Mumbai vs. Pr. CIT - 9, Mumbai

In the result, the appeal filed by the assessee is partly allowed

ITA 2663/MUM/2019[2014-15]Status: DisposedITAT Mumbai25 Jul 2022AY 2014-15

Bench: Shri Prashant Maharishi & Shri Pavan Kumar Gadalegiraffe Developers Pvt Vs. Pr. Cit – 9, Ltd Room No. 214, 2Nd 111, G Wing, Akruti Floor, Aayakar Commercial Complex, Bhavan, M.K. Road, Next To Akruti Centre Churchgate, Point, Central Road, Mumbai-400020. Andheri (E), Mumbai- 400093 Pan/Gir No. : Aaccn2778D Appellant .. Respondent Appellant By : Shri.Madhur Agrawal & Shri.Fenil Bhatt.Ar Respondent By : Shri.S.Anbuselvam.Dr Date Of Hearing 13.07.2022 Date Of Pronouncement 25.07.2022 आदेश / O R D E R Per Pavan Kumar Gadale Jm: The Assessee Has Filed The Appeal Against The Order Of Pr. Commissioner Of Income Tax (Appeals)-9, Mumbai Passed U/S 143(3) & 250 Of The Act. The Assessee Has Raised The Following Grounds Of Appeal:

For Appellant: Shri.Madhur Agrawal &For Respondent: Shri.S.Anbuselvam.DR
Section 139(1)Section 143(1)Section 143(2)Section 143(3)Section 263Section 271ASection 271BSection 40Section 40A(2)Section 92D

premises rented to the bank, yet at the time of making assessment the A0 had not made addition on account of notional interest on interest free deposits under section 23 (1)(a) of the Act. In this regard, while adjudicating the assessee's appeal against the order

Hongkong & Shanghai Banking Corporatin Lt, Mumbai vs. ADIT (It)-3(1), Mumbai

In the result, the appeal of the assessee is dismissed

ITA 2866/MUM/2009[2002-03]Status: DisposedITAT Mumbai20 Jul 2022AY 2002-03
For Appellant: Shri Madhav KanhereFor Respondent: Smt. Neelam Shukla (DR)
Section 143(1)Section 143(3)Section 2Section 234DSection 244A

assessee. 5 A.Y. 2002-03 HSBC Bank 8. The third and additional ground taken by the assessee relates to claim of interest on interest u/s 244A of the act on the delayed issuance of refund. For this, the assessee has relied on the Hon’ble Supreme Court ... case of Sandvik Asia Ltd (supra) dealt with a case where the taxpayer received certain refunds from the Income-tax Department without interest. The interest was later released to the assessee after a substantial delay of 12-17 years. The Hon’ble Apex Court accordingly allowed interest

Gmr Infrastructure Limited, Bengaluru vs. Assistant Director of Income Tax, CPC, Bangalore

In the result, the appeal filed by the assessee stands allowed for statistical purposes

ITA 362/BANG/2022[2020-21]Status: DisposedITAT Bangalore19 Jul 2022AY 2020-21
For Appellant: Shri Sunil Jain, CA
Section 115JSection 143(1)Section 237Section 244ASection 250

Supreme Court considered the question whether the decision in case of Sandik Asia Limited v. CIT [Supra] lays down the principle that interest on interest is payable when the refund is delayed. The Supreme Court explained the decision in Page 6 of 8 case of Sandvik Asia Limited ... this background, the Court directed the Revenue to pay compensation which cannot be seen as a direction for payment of interest on interest. The Supreme Court held and observed as under : "6. In our considered view, the aforesaid judgment has been misquoted and misinterpreted by the assesses

ACIT 28 (2), Mumbai vs. Real Trade Technologies, Mumbai

In the result, appeal filed by the Revenue is dismissed

ITA 6939/MUM/2019[2013-14]Status: DisposedITAT Mumbai07 Jul 2022AY 2013-14

Bench: Shri Pavan Kumar Gadale & Shri Gagan Goyalacit-28(2), Room No. 307, 3Rd Floor,Tower No.6, Vashi Railway Station Complex, Vashi, Navi Mumbai-400703 ...... Appellant Vs. M/S Real Trade Technologies, F-07, D-02, Real Tech Park, Plot No.-39/02, Sector-10, Vashi, Navi Mumbai-400705. Pan: Aaifr4687C ..... Respondent Appellant By : Sh. T. Shankar (Sr. Ar.Cit) Respondent By : Sh. M. Subramanian (Ar) Date Of Hearing : 12/04/2022 Date Of Pronouncement : 07/07/2022 Order Per Gagan Goyal, A.M: This Appeal By The Revenue Is Directed Against The Order Of Ld. Commissioner Of Income Tax (Appeals)-26, Mumbai [Hereinafter Referred To As ‘The Cit (A)’] Dated 26.08.2019 For The Assessment Year (Ay) 2013-14. The Revenue Has Raised The Following Grounds Of Appeal: "1. Whether On The Facts & In The Circumstances Of The Case & In Law, The Ld. Citia) Was Correct In Deleting The Disallowance Of Proportionate Interest Paid On Borrowed Capital Amounting To Rs. 2, 12 40,434/- U/S 36(1) (Iii) Of The Act Without Appreciating That The Assessee Has Not Been Able To Establish The Commercial

For Appellant: Sh. T. Shankar (Sr. Ar.CIT)For Respondent: Sh. M. Subramanian (AR)
Section 143(2)Section 36(1)

Appellant is a partnership firm engaged in the business of construction and land development. 3. During the assessment proceeding, AO disallowed proportionate interest on interest free loan given to sister concern in the form of share capital/unsecured loan/advance. Appellant given 93.5 lacs to M/s Gami Properties