AO held that interest paid by assessee on capital borrowed could not be allowed as deduction .Tribunal held that since interest was paid by assessee on loan used for acquiring or construction of assets that were used for earning taxable income, its claim for interest expenditure had to be allowed. On appeal High Court up held the order of the Tribunal. (AY. 2010-11)
PCIT v. International Biotech Park Ltd. (2018) 259 Taxman 14 (Bom.)(HC)
S. 36(1)(iii) : Interest on borrowed capital-loan was used for acquiring or construction of assets that were used for earning taxable income- Interest expenditure is held to be allowable.