Functional comparability governs software-service benchmarking: dissimilar companies are excluded, while related-party filters, margins and working-ca...
The ITAT reversed the CIT(A)/NFAC's disallowance of interest expenses claimed under section 57(iii). The Tribunal held that the appellant had successfully established the requisite nexus between borrowed funds on which interest was paid and the funds lent on which interest was earned, satisfying the statutory requirements. The ITAT noted that the Assessing Officer had allowed similar deduction claims in subsequent assessment years after scrutiny of the same loans and advances. Consequently, the Tribunal set aside the CIT(A)/NFAC's order and ruled in favor of the appellant, allowing the deduction of interest expenditure under section 57.
The ITAT reversed the CIT(A)/NFAC's disallowance of interest expenses claimed under section 57(iii). The Tribunal held that the appellant had successfully established the requisite nexus between borrowed funds on which interest was paid and the funds lent on which interest was earned, satisfying the statutory requirements. The ITAT noted that the Assessing Officer had allowed similar deduction claims in subsequent assessment years after scrutiny of the same loans and advances. Consequently, the Tribunal set aside the CIT(A)/NFAC's order and ruled in favor of the appellant, allowing the deduction of interest expenditure under section 57.
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