ITAT allows appeal, deletes interest expenditure disallowance after finding funds used for legitimate business purposes

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....ITAT allowed the assessee's appeal regarding disallowance of interest expenditure. The AO had disallowed interest claiming funds were diverted for non-business purposes. The assessee, engaged in manufacturing, trading and export of woolen carpets, maintained that interest expenditure in P&L account was exclusively for business purposes related to bank credit limits. Upon examining the ledger accounts, ITAT found that claimed interest expenditure was properly reflected in business accounts and was distinct from personal home loan interest paid to ICICI Bank Ltd. The tribunal concluded that the interest expenditure was legitimately incurred for business purposes, deleted the disallowance, and allowed the appeal in favor of the assessee.....