SC held broken period interest on securities should be allowed as revenue expense

Bank of Rajasthan Ltd Vs CIT (Supreme Court of India) Conclusion: The method of setting off and netting the amount of interest paid by it on the purchase of securities (i.e., interest for the broken period) against the interest recovered by it on the sale of securities and offering the net interest income to tax should be allowed as revenue expense as broken period interest incurred on securities treated as stock-in-trade and that Income Tax Deduction could be allowed on the same. Held: Assessee-Bank was engaged in the purchase and sale of government securities. The securities were treated as ...