Section 40A(2)(b): Interest Rate on Permanent Loan cannot be compared with Rate on Temporary Loan

CIT Vs  Shiv Agrevo Ltd. (Rajasthan High Court) The prevailing market rates of interest for the loans of permanent nature were between 18 per cent, to 24 per cent, whereas the cases compared by AO pertained to the loans of temporary nature and that the assessee had advanced money for the purpose of business needs. Therefore, the interest was not excessive or unreasonable under section 40A(2)(b). FULL TEXT OF THE ITAT JUDGMENT Since in all these appeals, common questions of law and facts are involved, they are decided by this common judgment. 2. By way of these appeals, the appellants have ch...