Tribunal held that where Department failed to establish nexus between interest bearing funds borrowed and interest free advances given to relatives of Assessee, no proportionate disallowance can be made for interest on borrowed funds. (AY. 2010-11)
ACIT v. Rohit Kochar (2018) 68 ITR 67 (SN) (Delhi) (Trib.)
S. 36(1)(iii) : Interest on borrowed capital–No proportionate disallowance of interest can be made unless the department establishes that the borrowed funds were utlilised for advancing interest free funds to relatives.