https://www.taxtmi.com/caselaws?id=169484 Interest on borrowings for acquisition of shares was held not deductible as business expenditure because the share purchase was an investment, not a step in carrying on the transport business; consequently section 10(2)(iii) treatment was rejected. The court applied the purpose test for expenditure under section 12(2), holding that interest voluntarily and commercially incurred solely for earning income from other sources is allowable even if no income (dividend) arises in the same year; the resulting loss may be set off under the loss set-off provision. The reference was answered in favour of the assessee on these points. en-us Mon, 20 Aug 1962 00:00:00 +0530 Tue, 21 Apr 2015 18:40:25 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=169484 Interest on borrowings for acquisition of shares was held not deductible as business expenditure because the share purchase was an investment, not a step in carrying on the transport business; consequently section 10(2)(iii) treatment was rejected. The court applied the purpose test for expenditure under section 12(2), holding that interest voluntarily and commercially incurred solely for earning income from other sources is allowable even if no income (dividend) arises in the same year; the resulting loss may be set off under the loss set-off provision. The reference was answered in favour of the assessee on these points. Case-Laws Income Tax Mon, 20 Aug 1962 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=169484