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.

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) 

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