2008 (2) TMI 9 - SCH - Income Tax

In view of decision of CIT v. M/s. Core Health Care Ltd. in Civil Appeal Nos.3952-55 of 2002, interest paid in respect of borrowings on capital assets not put to use in the concerned financial year can be permitted as allowable deduction u/s 36(1)(iii) - Revenue s appeal dismissed

Summary

The Supreme Court of India ruled that interest paid on borrowings for capital assets not put to use in the financial year is an allowable deduction under Section 36(1)(iii) of the Income-tax Act, 1961. The decision was based on a previous case in favor of the assessee. The Department's civil appeal was dismissed.