Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2018 (4) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (4) TMI 1882 - ITAT DELHIDisallowance of payment on account of EDO Charges - allowable expenditure u/s 37 or penal in nature as interest has been charged by concerned authority for delay - AO has disallowed the same considering it penal in nature - HELD THAT:- License the agreement allows assessee to make payments in installments subject to making an additional payment at 12% per annum on the unpaid portion of the amount - in case of any delay in payment of instalments in the manner agreed upon, as on due date, additional interest of 3% per annum would be chargeable, which assumes the nature of penalty. CIT (A) allowed interest paid by assessee as per the agreement at 12% as a part of business expenditure however disallowed interest paid over and above 12%, as additional payment of 3% is not covered in the normal course of the payment by assessee. It was held that the additional interest of 3% is penal in nature for failure to make payment of installment on time. No infirmity in such observation of Ld. CIT (A) - Decided against revenue.
|