Interest Disallowance Overturned: Daily Product Basis for Partner Payments Upheld, AO's Year-End Method Improper.

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....Disallowance of interest on account of excess payment to the partners on the capital account - the approach of the AO in calculating the interest by considering only the closing balance as on the end of the financial year is not proper and justified. Accordingly, so far as the interest calculated by the assessee firm on daily product basis is concerned, the same is proper and justified. - AT....