Interest on borrowed capital cannot be disallowed for Investment in subsidiaries out of Sufficient own funds

DCIT Vs Firstsource Solutions Ltd. (ITAT Mumbai) Assessee held own funds of Rs. 23,580 lakhs, whereas investment in subsidiaries stood at Rs. 1,576 lakhs. Presumption in such case would be that assessee had used only its own funds for making investments. Further, there was commercial expediency in making said investments, hence no disallowance was called for. FULL TEXT OF THE ITAT JUDGMENT These cross appeals are directed against the orders passed by Ld CIT(A)-5, Mumbai and they relate to the assessment years 2004-05 and 2005-06. All these appeals were heard together and hence, they are being ...