Matching Principle Not applies to Cash Accounting – Section 36(1)(iii) Disallowance Deleted

CIT Vs Shriram Investments (Madras High Court) The Revenue filed a tax case appeal before the Madras High Court challenging the order dated 12.01.2022 of the Income Tax Appellate Tribunal (‘B’ Bench, Chennai) in ITA No. 2232/Chny/2019 relating to assessment year 2015-16. The substantial questions of law raised concerned whether the Tribunal was correct in deleting the disallowance under Section 36(1)(iii) of the Income Tax Act where the assessee had advanced interest-bearing funds without charging interest to associated concerns, and whether the Tribunal erred in not applying the matching ...