https://www.taxtmi.com/caselaws?id=468669 Interest on borrowings used to fund a partner's capital contribution in a partnership firm was held not disallowable merely because the borrowing cost exceeded the return from the firm. In the absence of a finding that the funds were used for non-business purposes or that commercial expediency was lacking, the higher interest rate alone did not justify disallowance. The resulting business loss was also held eligible for set-off against income from other heads, as no statutory bar prevented adjustment of a non-capital loss under the applicable set-off rules. The contrary additions were deleted and full relief was granted to the assessee. en-us Fri, 07 Feb 2025 00:00:00 +0530 Fri, 15 May 2026 20:34:43 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=468669 Interest on borrowings used to fund a partner's capital contribution in a partnership firm was held not disallowable merely because the borrowing cost exceeded the return from the firm. In the absence of a finding that the funds were used for non-business purposes or that commercial expediency was lacking, the higher interest rate alone did not justify disallowance. The resulting business loss was also held eligible for set-off against income from other heads, as no statutory bar prevented adjustment of a non-capital loss under the applicable set-off rules. The contrary additions were deleted and full relief was granted to the assessee. Case-Laws Income Tax Fri, 07 Feb 2025 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=468669