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2009 (10) TMI 421 - HIMACHAL PRADESH HIGH COURTBusiness Expenditure- Fines and penalties- The assessee paid royalty to the State Government at rates which were finalized by the pricing committee by the State Government. The assessee ws liable to pay interest on belated payment of royalty and other amounts payable to the state government. The forest department was liable to pay sales tax on royalty but in actual fact this amount was actually deposited by the assessee on behalf of the Forest Department. A lease deed was executed by the Forest Department in favour of assessee. The Commissioner (Appeals) upheld the order of the Assessing Officer and the Tribunal allow the appeal. further appeal to High Court. Held that- Since the assessee follows the mercantile system of accounts this deduction was allowable. The case has been disposed of in favour of assessee and against the department.
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