https://www.taxtmi.com/caselaws?id=16229 HC held for the Revenue that interest deduction under s 36(1)(iii) is disallowed to the extent borrowed funds were diverted from business purposes by advancing interest-free loans to partners' relatives. The court found diversion clearly established-borrowed monies had been invested in contracts, recovered, and then lent out interest-free-so interest attributable to the diverted amounts is not an allowable business deduction until those funds are brought back and used in the business. The appeal was decided against the assessee; parties to bear their own costs. en-us Mon, 03 Aug 1998 00:00:00 +0530 Fri, 10 Oct 2025 13:31:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=16229 HC held for the Revenue that interest deduction under s 36(1)(iii) is disallowed to the extent borrowed funds were diverted from business purposes by advancing interest-free loans to partners' relatives. The court found diversion clearly established-borrowed monies had been invested in contracts, recovered, and then lent out interest-free-so interest attributable to the diverted amounts is not an allowable business deduction until those funds are brought back and used in the business. The appeal was decided against the assessee; parties to bear their own costs. Case-Laws Income Tax Mon, 03 Aug 1998 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=16229