https://www.taxtmi.com/caselaws?id=369768 Interest on borrowed capital used to acquire and develop land for a real estate venture was deductible once the business had been set up, even though full commercial sales had not yet commenced. The distinction between setting up of business and actual commencement was decisive: where the assessee had purchased land, pursued conversion, paid approval-related charges and obtained site plan approval, the business was regarded as already set up. The accounting description of the land as an investment did not control its legal character, which had to be determined from the surrounding facts and business conduct. Interest was therefore allowable as business expenditure and the disallowance was deleted. en-us Tue, 24 Jul 2018 00:00:00 +0530 Fri, 02 Nov 2018 13:45:09 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=369768 Interest on borrowed capital used to acquire and develop land for a real estate venture was deductible once the business had been set up, even though full commercial sales had not yet commenced. The distinction between setting up of business and actual commencement was decisive: where the assessee had purchased land, pursued conversion, paid approval-related charges and obtained site plan approval, the business was regarded as already set up. The accounting description of the land as an investment did not control its legal character, which had to be determined from the surrounding facts and business conduct. Interest was therefore allowable as business expenditure and the disallowance was deleted. Case-Laws Income Tax Tue, 24 Jul 2018 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=369768