https://www.taxtmi.com/caselaws?id=23051 HC upheld disallowance under s.36(1)(iii) of interest paid on loans advanced to closely held shareholders/directors at concessional rates, finding no business purpose for such lendings. The court held the company's directors exploited their control to obtain substantial advances at artificially low interest, causing large interest outflows unrelated to the company's business needs; had the funds remained with the company, bank borrowings might have been reduced. HC found the tax authority's disallowance justified and rejected the Tribunal's favorable, superficial approach. en-us Tue, 31 Jul 1990 00:00:00 +0530 Mon, 27 Oct 2025 19:37:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=23051 HC upheld disallowance under s.36(1)(iii) of interest paid on loans advanced to closely held shareholders/directors at concessional rates, finding no business purpose for such lendings. The court held the company's directors exploited their control to obtain substantial advances at artificially low interest, causing large interest outflows unrelated to the company's business needs; had the funds remained with the company, bank borrowings might have been reduced. HC found the tax authority's disallowance justified and rejected the Tribunal's favorable, superficial approach. Case-Laws Income Tax Tue, 31 Jul 1990 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=23051