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2018 (7) TMI 1476 - AT - Income TaxDisallowance u/s.36(1)(iii) - advancing of loans - Disallowing part of the interest expenses based on matching principle - Held that:- Assessee has been considered as an investment company and making investments was part of its business. Hon’ble Jurisdictional High Court also in the case of CIT vs. Shriram Investments (Firm)[2014 (11) TMI 55 - MADRAS HIGH COURT] also held that deduction u/s.36(1) (iii) of the Act had to be allowed in respect of interest paid, if capital was borrowed for the purpose of business or profession. As already mentioned by us, there is no finding by any of the lower authorities that disparity between interest receipts and payments arose on account of charging of lower rate of interest on loans advanced when compared to interest paid on loans received. In the circumstances, we are of the opinion that ld. Assessing Officer was not justified in making a disallowance for the difference between interest received and interest paid by the assessee. - Decided in favour of assessee
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