Interest expenditure for expansion of business was allowable as revenue expenditure

CIT Vs Nirma Ltd (Gujarat High Court)

Conclusion: Expenditure incurred on soda ash project interest expenses and lab project interest was allowable and it was not pre-operative expenditure of interest by way of revenue expenditure as it was for an expansion of the existing business.

Held: AO disallowed soda ash project interest expenses and lab project interest. AO questioned the assessee on these expenses and deleted the same on two grounds, firstly that interest was paid by way pre-

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