https://www.taxtmi.com/caselaws?id=790845 Contractual interest payable under a capital bond arrangement was held to be deductible as business expenditure where the agreement expressly required the assessee to pay interest to the counterparty on funds placed in the capital bond account. The liability was treated as enforceable under the contract and coextensive with the interest income earned from those deposits, which was taxable in the assessee's hands. On a fresh reading of clause 5, the earlier view that no obligation existed was not accepted, and the corresponding interest expenditure was allowed as a deduction. The disallowance was deleted and the deduction claim succeeded. en-us Tue, 28 Apr 2026 00:00:00 +0530 Fri, 01 May 2026 10:14:38 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=790845 Contractual interest payable under a capital bond arrangement was held to be deductible as business expenditure where the agreement expressly required the assessee to pay interest to the counterparty on funds placed in the capital bond account. The liability was treated as enforceable under the contract and coextensive with the interest income earned from those deposits, which was taxable in the assessee's hands. On a fresh reading of clause 5, the earlier view that no obligation existed was not accepted, and the corresponding interest expenditure was allowed as a deduction. The disallowance was deleted and the deduction claim succeeded. Case-Laws Income Tax Tue, 28 Apr 2026 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=790845