Interest on Borrowings for Acquisition of Capital Assets allowable u/s 36(1)(iii)

PCIT Vs Vodafone Shared Services Ltd. (Gujarat High Court)

The interest paid in respect of the borrowings for acquisition of capital assets is allowable under Section 36(1)(iii) of the Act regardless of the fact that the capital assets acquired were not put to use in the concerned financial year in question.

In this case the Tribunal has placed reliance on the decision of the Supreme Court in the case of Care Healthcare Ltd.

FULL TEXT OF THE HIGH COURT ORDER /JUDGEMENT

1. This tax appeal under Section 260A of the Income Tax Act, 1961 (for short “the Act, 1961”) is at the instance of the Revenue and is directed against the order passed by the Income Tax Appellate Tribunal, Ahmedabad, Bench “C”, Ahmedabad dated 28th May, 2019 in the ITA No.162/Ahd/2016 for the A.Y.2010-11.

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