1994 (7) TMI 18 - HC - Income Tax

Summary

The High Court of Rajasthan held that interest paid to directors on their deposits in running accounts is disallowable under section 40A(8) of the Income-tax Act, 1961. The court referred to a previous case and concluded that such payments are considered as deposits and should be subject to disallowance. The Tribunal's decision was not justified, and the reference was answered in favor of the Revenue.