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2014 (8) TMI 10 - HC - Income TaxInterest expenses on borrowed funds u/s 36(1)(iii) – Held that:- Tribunal was of the view that the interest paid on the borrowals utilized for investments in a foreign company namely M/s Kemsol Ltd could not be allowed as deduction as it was not in the course of Assessee’s business - there was no evidence placed on record by the Assessee to support the argument of commercial expediency in acquiring 60% of the shares of M/s Kemsol Ltd. - the interest paid on borrowed funds was not for the purpose of the business of the Appellant/Assessee – tribunal was correct in its approach, both legally and factually in passing the order that it did. The investments made by the Assessee Company in its subsidiary were for furthering the business interests of the Assessee - there was no justification to disallow the deduction, which was otherwise eligible u/s 36(1)(iii) of the Act - the authorities below have come to a categorical finding that the investment made in M/s Kemsol Ltd from borrowed funds was not for the purpose of business of the Assessee. Foreign travel expenses – Held that:- The approach of the Tribunal in restricting the disallowance of the foreign travel expenses to 10% of the amount claimed by the assessee is more than a reasonable approach - It cannot be said to be vitiated either on the ground of perversity or error of law apparent on the face of the record – Decided against assessee.
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