IS INTEREST PAID TO BANK RS. 15000 IN CONNECTION WITH OVERDRAFT OBTAINED FOR PAYING DIVIDEND IS ADMISSIBLE EXPENSE OR NOT
1 Replies
Aditya Maheshwari
(CA in Practice)
(35867 Points)
Replied 15 April 2010
Interest on borrowals for payment of dividend is deductible - Interest paid on moneys borrowed, which are utilised for payment of dividend to the shareholders of a company, is entitled to deduction under section 36(1)(iii) - Kesar Sugar Works Ltd. v. CIT [1997] 140 CTR (Bom.) 431.
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