Supreme Court of India

L.K. Trust v. Commissioner of Income Tax

Neutral citation
Reported as [2026] 5 S.C.R. 567
Bench J.B. Pardiwala and Ujjal Bhuyan JJ.
Decided 7 May 2026

INSC stands for INDIAN SUPREME COURT. A neutral citation scheme assigned by the Court itself, so a judgment can be cited without depending on a commercial law reporter. INSC is the neutral citation scheme assigned by the Supreme Court, so a judgment can be cited without depending on a commercial law reporter.

What the Court ordered

In view of the aforesaid detailed discussions and respectfully following the judicial pronouncements, we conclude by holding that a sum of Rs.21, 7 4,234 /- paid by the appellant-trust as interest to the Corporation Bank on borrowings of Rs.3.80 crores is eligible for deduction under Sec.36(1)(iii) of Income-tax Act.

Judgment, page 6

From the headnote

Issue for Consideration Issue arose whether the appellant-assessee is entitled to a deduction of Rs.21,74,234/- being the interest paid by it in respect of the loan availed from the Corporation Bank u/s.36(1)(iii) of the Income Tax Act 1961. Headnotes† Income Tax Act 1961 – s.36(1)(iii) – Deduction in respect of amount of the interest paid in respect of capital borrowed for the purposes of business or profession – Assessee, if eligible for deduction of interest paid to the bank u/s.36(1)(iii) – Assessee borrowed loan from the Bank and paid interest in order to invest the same in its share

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