2006 (4) TMI 516

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....creditors, regarding which it had claimed a deduction that was disallowed on the ground that the assessee had not recovered interest from its debtors one of whom happened to be its own sister concern. The Tribunal has by the impugned order reversed that view. It has in our opinion, correctly held that there was no direct linkage between interest which the assessee was paying to its creditors and t....

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....IT(A), is not questioned or doubted. If that is so, the interest is allowable as a deduction, as expenditure wholly and exclusively incurred for the purpose of business under section 37(1). We are not concerned with the question as to whether the assessee ought to have charged interest from its trade debtors. In our opinion, even this question should be answered in favour of the assessee, since it....