Held that the sum given by assessee to its sister concern was an investment in another group company by way of share application money and not a loan. Disallowance of interest is not justified. Where borrowed money was transferred to a sister concern. The Assessing Officer was directed to levy interest; however, only for the actual period of the loan, i.e., for one day. (AY. 2016-17)
Kamineni Health Services (P.) Ltd. v. ACIT (2025) 213 ITD 130 (Hyd) (Trib.)
S. 36(1)(iii) : Interest on borrowed capital-Share application money-Sister concern-Disallowance of interest is not justified-Borrowed money–transferred to sister concern. The Assessing Officer was directed to levy interest; however, only for the actual period of the loan, i.e., for one day.
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