Interest Rate on Secured Loan From banks Cannot be Compared with Interest Rate on Unsecured Loan: ITAT

The Income Tax Appellate Tribunal (ITAT) ruled that the interest rate on secured loans from banks cannot be directly compared with the interest rate on unsecured loans. The tribunal highlighted that the differences in risk profiles between secured and unsecured loans justify the variance in interest rates. This decision underscores the need for appropriate benchmarks in assessing the reasonableness of interest expenses for tax purposes.