Assessee had claimed deduction of Interest paid to firm on its excess borrowings from firm resulting into a debit balance. AO during assessment proceedings held that interest paid to firm is not allowable, as the amount withdrawn has been utilised for payment of advance tax and income tax which is the personal liability of the assessee. CIT(A) confirmed the disallowance. On Appeal, the Tribunal held that, disallowance of interest paid to firm on withdrawals from partnership firm, on ground that the said funds were  withdrawn for payment of taxes which was personal liability of a partner cannot be sustained, for the reason that :

1. Once a partner has withdrawn an amount from firm, the end use thereof is immaterial.
2. It is not within the purview of the IT authorities to determine and dictate as to how the funds so withdrawn are put to use by assessee/partner.
3. The instant case is not of claiming an amount of tax on income. (AY.2015-16 & 2017-18)