https://www.taxtmi.com/caselaws?id=9839 Interest on borrowings is disallowable under section 36(1)(iii) to the extent borrowed funds are diverted interest-free to sister concerns for non-business purposes; the assessee must show that the borrowing was used for business, and the disallowance was upheld. Sales tax subsidy received after commencement of production, where the scheme operated as an incentive for carrying on business and was not linked to setting up or acquiring capital assets, is a revenue receipt; the subsidy was therefore taxed as revenue and not as capital. The note states that both disputed additions were upheld and the Revenue succeeded. en-us Fri, 04 Aug 2006 00:00:00 +0530 Thu, 18 Sep 2025 13:24:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=9839 Interest on borrowings is disallowable under section 36(1)(iii) to the extent borrowed funds are diverted interest-free to sister concerns for non-business purposes; the assessee must show that the borrowing was used for business, and the disallowance was upheld. Sales tax subsidy received after commencement of production, where the scheme operated as an incentive for carrying on business and was not linked to setting up or acquiring capital assets, is a revenue receipt; the subsidy was therefore taxed as revenue and not as capital. The note states that both disputed additions were upheld and the Revenue succeeded. Case-Laws Income Tax Fri, 04 Aug 2006 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=9839