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2015 (11) TMI 1446 - AT - Income TaxClaim of interest on share capital - whether allowable to assessee or not? - Held that:- As rightly considered by the Ld. CIT(A), in the case of Co-operative Society, there is a liability to repay the share capital to the Member concerned once he ceases to be a Member. Therefore, the share capital in the hands of the Co-operative Society cannot be equated with the share capital of the company and it can be treated as ‘borrowed capital’. Same issue was considered by the Co-ordinate Bench in the case of Visakhapatnam Co-operative Bank Ltd., Vs. Addl. CIT [2011 (8) TMI 319 - ITAT VISAKHAPATNAM] wherein it was held that interest paid on share capital goes to reduce the interest collected by the Society from its Members and it would not form part of profit. - Decided in favour of assessee.
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