https://www.taxtmi.com/caselaws?id=277210 Interest on borrowed capital was deductible under section 10(2)(iii) of the Indian Income-tax Act, 1922 only where the borrowing related to a business capable of yielding taxable profits chargeable in British India. Borrowed funds used entirely outside British India to invest in securities kept and managed outside British India did not satisfy that requirement, because the connection with taxable Indian income was absent. Mere borrowing for business purposes was insufficient without a nexus to income assessable under the Act. On that basis, the interest deduction was held not allowable against income accruing and arising in British India. en-us Thu, 20 Aug 1931 00:00:00 +0530 Thu, 29 Nov 2018 10:18:57 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=277210 Interest on borrowed capital was deductible under section 10(2)(iii) of the Indian Income-tax Act, 1922 only where the borrowing related to a business capable of yielding taxable profits chargeable in British India. Borrowed funds used entirely outside British India to invest in securities kept and managed outside British India did not satisfy that requirement, because the connection with taxable Indian income was absent. Mere borrowing for business purposes was insufficient without a nexus to income assessable under the Act. On that basis, the interest deduction was held not allowable against income accruing and arising in British India. Case-Laws Income Tax Thu, 20 Aug 1931 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=277210