Pre-Meditated/ Self Inflicted Loss by giving loan to related concern at concessional Rate not allowable

The background facts of the case are that the assessee, an individual, lent monies to a company, Purple Creation P. Ltd., at 12% p.a., during the year, earning interest at Rs.23,82,523/-. The same were, however, financed by borrowed capital, on which interest stood incurred at Rs.31,39,579/-. Besides, the borrowing being through  agency of finance brokers, another sum of Rs.1,33,954/- was incurred toward brokerage charges. Claim of these expenses against interest income, assessable u/s. 56 of the Act, resulted in a loss of Rs.8,87,532/-; the assessee also earning some bank interest. It is the...