Section 36 of Income Tax Act, 1961—This Income Tax Appeal is filed by the Revenue challenging the order of the Income Tax Appellate Tribunal.

Tribunal upholds the decision of  CIT (A) in allowing assessee’s claim for deduction of interest on borrowed fund when the same is utilised to give interest free loan/share application money to subsidiary companies.

Held that—The entire issue is quarely covered in favour of the assessee in case of S.A. Builders Ltd. (supra). The Tribunal correctly held that the assessee’s decision to fund its subsidiaries driven by business exigency.[THE PR. COMMISSIONER OF INCOME TAX - 9 VERSUS M/S. E-CITY INVESTMENTS & HOLDINGS COMPANY PRIVATE LTD.] [2019] 15 ITCD Online (65) [BOMBAY HIGH COURT]