https://www.taxtmi.com/caselaws?id=288939 Deduction of interest on borrowed capital under section 36(1)(iii) is allowable only where the assessee proves that the borrowing was for business purposes and supported by commercial expediency. On the record, the assessee failed to comply with earlier directions and did not produce loan agreements or other material showing a business justification for borrowing at a higher rate and advancing funds at a lower rate. The requisite nexus between the borrowing and the claimed business purpose was therefore not established, and the disallowance of the interest expenditure was upheld. en-us Thu, 27 Oct 2016 00:00:00 +0530 Tue, 07 Jul 2020 11:16:45 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=288939 Deduction of interest on borrowed capital under section 36(1)(iii) is allowable only where the assessee proves that the borrowing was for business purposes and supported by commercial expediency. On the record, the assessee failed to comply with earlier directions and did not produce loan agreements or other material showing a business justification for borrowing at a higher rate and advancing funds at a lower rate. The requisite nexus between the borrowing and the claimed business purpose was therefore not established, and the disallowance of the interest expenditure was upheld. Case-Laws Income Tax Thu, 27 Oct 2016 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=288939