Assessee company had borrowed interest bearing funds for setting a SEZ  Assessee-company had engaged services of a company to do job of intermediary between assessee, land owners and relevant government bodies to negotiate purchase price of land, make payments and complete formalities.  Assessee paid Rs. 290 crores to it. As said company could not fulfil requirements, it paid back a sum as compensation over and above payment made by assessee. The  Assessing Officer  held that difference between income generated and interest paid was not allowable. On appeal the  and Commissioner (Appeals) and  Tribunal held that since interest were paid on funds which were utilised for business purpose only, entire interest expenses had to be allowed in toto under section 36(1)(iii) as well as under section 37(1) as being for purpose of business. On appeal by the Revenue, the High Court affirmed the order of the Tribunal. (AY. 2009-10)