Deduction under s 35AB

Deduction under s 35AB of the Act is allowable if assessee uses the technical knowhow to get the goods manufactured through a third party under its direct supervision and control — as held by MumHC in CIT v Sarabai Piramal Pharmaceuticals Ltd — In favour of: The assessee.

Deduction under s 36(1)(iii) — Even if the borrowed funds were utilised for the acquisition of capital assets, interest paid on borrowed funds is allowable as revenue expenditure under s 36(1)(iii).

Decided on: 14 September 2011.