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2022 (11) TMI 673 - HC - Income TaxDeduction u/s 36(1)(iii) on the interest - Tribunal and the CIT(A) justification in holding that interest expenditure is liable to be treated as capital expenditure and allowance u/s 36(1)(iii) on the ground that the assessee has incurred the same for business purpose - HELD THAT:- It is not in dispute that the EMD paid by the assessee has been received back with interest and the said interest has been offered to tax. It is also not in dispute that the assessee is in the business of Real Estate Development and the EMD amount was paid to acquire properties as a part of its business, which should be treated as Stock-in-trade. The Tribunal has rightly noticed that the proviso was inserted with effect from 01.04.2004 and the amount borrowed was not for acquisition of any asset for extension of existing business. Therefore, assessee was entitled for the benefit under Section 36(1)(iii) - The question of law is answered in favour of the assessee and against the Revenue.
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