https://www.taxtmi.com/caselaws?id=21434 The High Court of Gujarat held that interest paid on loans by a partnership firm, obtained through individual partners, could not be disallowed under section 40(b) of the Income-tax Act, 1961. The Court distinguished the case from a precedent where interest was disallowed as capital raised by partners, noting that in this instance, the loans were immediately transferred to the firm's account and interest was paid directly to the bank. As the firm borrowed the money for business purposes, the interest paid to the bank was allowed as a deduction, ruling in favor of the assessee-firm and against the Revenue. en-us Sat, 07 Sep 1991 00:00:00 +0530 Tue, 24 Nov 2009 13:11:15 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=21434 The High Court of Gujarat held that interest paid on loans by a partnership firm, obtained through individual partners, could not be disallowed under section 40(b) of the Income-tax Act, 1961. The Court distinguished the case from a precedent where interest was disallowed as capital raised by partners, noting that in this instance, the loans were immediately transferred to the firm's account and interest was paid directly to the bank. As the firm borrowed the money for business purposes, the interest paid to the bank was allowed as a deduction, ruling in favor of the assessee-firm and against the Revenue. Case-Laws Income Tax Sat, 07 Sep 1991 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=21434