Assessee is  engaged in business of finance and investment.  It adopted cash system of accounting. Assessee  borrowed capital from its group concerns and paid interest at lower rate. It claimed deduction of interest paid on borrowed capital under section 36(1)(iii).Assessing Officer on basis of ‘matching principles’ made disallowance on account of difference between interest received and paid by assessee. Tribunal deleted the addition. On appeal the Court held that when cash system of accounting was adopted by assessee, an investment company, whose business was only to borrow and lend or invest, interest paid by assessee on amount taken for utilising it for further lending was said to be in business interest or commercially expedient for purpose of business. Followed CIT v. Shriram Investments [2020] 122 taxmann.com 74/422 ITR 528 (Mad.) (HC)AY. 2015-16)