18.  Deductions:-

(1)   In computing the income under the head "Interest on securities" the following allowances and deductions shall be made, namely:-

(a)    any interest paid by the assessee to any banking company or other person on moneys borrowed by him for the purpose of investment in securities; and

(b)    any commission paid to a banking company for realising interest on such securities on behalf of the assessee.

(2)   For the purposes of sub-section (1),-

(a)    "moneys borrowed" shall, in the case of a banking company, include moneys received by way of deposits; and

(b)    the amount to be regarded as interest paid on moneys borrowed shall not exceed an amount which bears to the amount of interest paid on all moneys borrowed by the assessee the same proportion as the total amount of interest on securities (inclusive of tax deducted under sub-section (2) of section 50) bears to the gross receipts from all sources included in the profit and loss account of the assessee.

(3)   Where the securities in respect of which any interest is receivable by an assessee consist of, or include, any securities to which clause (a) of sub-section (2) of section 17 applies, no allowance or deduction on account of any interest or commission paid under clause (a) or clause (b) of sub-section (1), as the case may be, in respect of, or allocable to, the said securities shall be made in computing the income under the said sub-section (1).

(4)   The allowances and deductions made under sub-section (1) shall not be admissible for the purpose of computing the income of the assessee under any other head.

(5)   The provisions of section 24 shall, so far as may be, apply to the allowances and deductions under this section as they apply to the allowances and deductions in respect of income chargeable under the head "Income from business or profession".