Interest on borrowing to pay earliest money deposits allowable as deduction u/s 36(1)(iii)

DCIT Vs M/s. Prestige Garden Estates Pvt. Ltd. (ITAT Bangalore) Conclusion: Deduction was allowable under section 36(1)(iii) on interest on borrowing to pay earnest money deposits (EMD) to purchase properties being lands, flats, etc. as the same was for purpose of assessee’s business of acquiring properties. Held: In the present case, assessee-company was engaged mainly in the business of purchase of lands and to construct, sell flats, apartments, dwelling-houses, shops, etc. In the course of its business, it participated in the bids invited for sale of properties by NGEF and HUDA during fin...