No sec 40A(2)(b) rws 36 disallowance on Trade advance given to sister concern

CA Prarthana Jalan Hon’ble Allahabad High Court has in the case of CIT v/s M/S Ghari Industries Pvt. Ltd in ITA No 26 of 2017 vide order dated 1.3.2017 has dismissed the appeal of the department as no disallowance can be made under Section 40A(2)(b) read with Section 36 of the Income Tax Act  of interest paid on borrowed funds for trade advance given out of commercial expediency to sister concerns. Brief Facts of the case are that The appellant was engaged in the manufacture and sale of leather shoe, leather and trading of detergents. It had got certain quantities of detergent manufa...