Int. on service tax
This query is : Resolved
04 August 2014
Is interest on service tax is allowable expenses as per IT Act 1961?
04 August 2014
No it is disallowed expenditure. U can't claim it at the time of filing ITR.
04 August 2014
Interest is compensatory in nature and hence allowable as business expenditure. Penalty is for contravention of the provisions of an act and,therefore, not allowable as a business expenditure. The Apex Court in 'Swadeshi Cotton Mills Co. Ltd., V. Commissioner of Income Tax' 2008 - Supreme Court was dealing with the question as to whether damages paid for delayed payment of employees contribution to employees' provident fund was compensatory or penal. The court following the judgment in 'Prakash Cotton Mills Ltd.,' - 2008 - Supreme Court remitted the matter to the High Court for reconsideration in the light of the observation made therein. Also refer the following article in this regard--
http://www.taxmanagementindia.com/visitor/detail_article.asp?ArticleID=788
http://www.taxmanagementindia.com/visitor/detail_article.asp?ArticleID=788
04 August 2014
The interest paid on late payment of service tax is compensatory in nature and cannot be held to be penal in character; therefore it is a permissible deduction under Income Tax. Refer to link http://www.taxindiaonline.com/RC2/print_story.php?newsid=10324
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Unanswered Queries
- REGARDING GST ON COMMERICIAL PROPERTY
- Is this income indian or foreign income?
- 15ca /15cb whose income tax login? remitter or nri seller's login?
- Regarding Documentation & Compliances for Opening of Unit of Pvt Ltd.
- GST on export of services and Input Credit
- TDS U/S. 194NF
- ITC temporary reversal and reclaim
- RCM applicability on Rent Paid by Registered Person to Unregistered Landlord for Residental Building
- Applicable TDS rate for sale of property in Nov 2024
- Should I report my US salary for January, February, March in Schedule FA?
- IGST Credit-Show cause notice issued-confusion
- Short and Excess provision of expenses
- Issue of gst e invoice
- Interchangeable words in accounts
- Adjusted profit/Loss in the case of LLP and Pvt. Ltd.company
- How to adjusted advances given or receipt
- Foreign vendor without PAN unable to to register due to non receipt of OTP on foreign number ?
- 133(6) DIN INVALID format error - ->WHERE TO REPLY 133(6) notice?
- Query for dubts
- Regarding Resignation by Auditor from Pvt. Ltd.
Trending Online Classes
CAclubindia
