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2014 (1) TMI 131 - AT - Income TaxDisallowance of excessive interest rate - Held that:- The assessee had paid interest @ 10.5% on secured loans whereas paid ineterest 2 18% on loans from relatives - The assessee has not shown that there was payment of interest @ 18% to outside parties in the year under consideration or in any of the earlier or subsequent years - No other justification to show that payment of interest @ 18% rate is reasonable was given nor any compelling circumstances have been brought to our notice - Following assessee's own case for A.Y. 2006-07 - The CIT(A) took reason to allow deduction of interest @ 2 to 3% higher than the rate at which secured loans are available - It is considered reasonable to allow a deduction of interest @ 15% - The issue was restored for fresh adjudication.
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