Whether Environmental Damage Penalty
(Rs 15 00 000)is allowable expenditure? please suggest any case law regardind this.
The ITAT, in a recent order, underlined this difference further in a case involving Bharat C Gandhi, proprietor of Darshan Roadlines. Accepting this argument, the ITAT held that the compounding fees paid were not in the nature of penalty, but were allowable as expenditure incurred out of commercial expediency.
Some more similar judgments are hereunder…
1. https://indiankanoon.org/doc/129560600/
2. https://indiacorplaw.in/2019/09/expenses-incurred-assessee-penal-compensatory-nature.htm
3. https://tax guru.in/income-tax/compounding-fee-legal-metrology-dept-allowable-expense.htm
4. https://tax guru.in/income-tax/revenue-decide-commercial-expediency-business.htm
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