Interest rate on unsecured loan cannot be excessive if same is less than interest paid on secured loan

Shaheed Kartar Singh Saraba Charitable Trust (Redg.) Vs DCIT (ITAT Chandigarh)

It is an admitted fact that the assessee has derived interest on its fixed deposits maintained with bank(s) @ 7.5% to 7.75% and in turn paid interest to its trustee Shri Grewal in question @ 10% and @ 14.75% to State Bank of Patiala in their relevant previous year (supra). All this same sufficiency indicates that the Assessing Officer had erred during the course of assessment in comparing the assessee’s fixed deposits interest derived from banks

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