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2014 (9) TMI 14 - HC - Income TaxDeduction on interest on borrowed loans – interest free loan given to sister concern - Held that:- Assessee borrowed certain amounts from a financial institution and claimed the deduction of interest paid - the conclusion of the AO could have been approved or upheld, if only he was able to demonstrate that what was advanced by the respondent to its sister concern was nothing but the amount borrowed from the financial institution - It is not uncommon that even where an entrepreneur is possessed of resources to establish a business undertaking, borrowing of the amount for that very purpose may prove to be beneficial to him - once it emerges that the AO did not record any finding to the effect that the assessee has borrowed the amount on interest and straight away passed on it to the sister concerned, without levying interest, there was no way he could have disallowed the interest – Decided against revenue.
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