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2005 (8) TMI 62 - ALLAHABAD HIGH COURTFirm – assessment of partner - "Whether, Tribunal was wrong in holding that the interest charged by the firm, on the debit balance of the assessee-partner in his capital account was allowable as expenditure incurred to earn his share of profit under section 67(3) from the firm?" - admittedly, in the present case, the respondents-assessees have borrowed money from the firm for defraying their personal expenses like interest payment, CDS payment, etc. The amount was not taken for carrying on any business. Even if under the terms of the partnership deed they were liable to pay interest on their debit balance it cannot be treated as if the amount had been borrowed for carrying out business of the firm or the payment of interest was for the purposes of carrying out business. In the absence of any specific provision under the Act entitling a person to claim deduction of interest paid on sums borrowed for personal expenses, the same cannot be allowed as a deduction
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