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2022 (7) TMI 223 - HC - Income TaxDeduction of interest charged by the Reserve Bank of India (RBI) - Appellant claimed these amounts in light of the interest charged by the Reserve Bank of India (RBI) under Section 42(3) of the R.B.I. Act - AO disallowed the deduction - whether ITAT erred in holding that the appellant was not entitled to a deduction, in computing its business income under the Act, of the interest of Rs.3.7 crores paid by it to RBI - HELD THAT:- As decided in BANK OF BARODA [2011 (2) TMI 1609 - BOMBAY HIGH COURT] interest paid to the RBI was not penalty and accordingly the interest expenditure is allowable - thus the question framed will have to be answered in favour of the Appellant.
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