Expenses incurred on Financial Charges allowable as Expenditure: ITAT[Read Order]

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The Income Tax Appellate Tribunal (ITAT), Jaipur has held that the expenses incurred on financial charges can be deductible from Business Income as the same would amount to business expenditure.  

Deduction of expenses incurred for earning business income is spelt out in the Sections 30 to 36 of Income Tax Act, 1961.

In the instant case, both the Assessing Officer and the first appellate authority treated the land as capital asset and accordingly, capitalized the interest on the loan, processing fee and bank charges etc. incurred for purchase of land. 

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Source: Taxscan