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2019 (7) TMI 925 - AT - Income TaxDisallowance u/s 36(1)(va) read with 2(24)(x) for late payment of Employees Contribution to PF/ESI - paid within due date of filing of return - HELD THAT:- If the assessee deposits PF and ESI before the due date of filing of return of income then it would be considered sufficient compliance and no addition should be made on account of late payment of PF and ESI. For that we rely on the judgment of the Jurisdictional Hon’ble Calcutta High Court in the case of Vijay Shree Ltd. [2011 (9) TMI 30 - CALCUTTA HIGH COURT] wherein it was held that if the assessee deposited PF and ESI within the due date prescribed it u/s 139(1) then no disallowance should be made. That being so, we decline to interfere in the order passed by the Ld. CIT(A), his order on this issue, is hereby upheld and grounds raised by the revenue is dismissed. Disallowance under the head interest on TDS, VAT, entry tax and professional tax - HELD THAT:- We note that the interest on VAT, TDS and interest on entry tax and interest on professional tax are allowable expenditure u/s 37(1) of the Act, as these expenses normally incurred by the assessee in doing the business. We also note that the interest on arrears of sales tax is compensatory in nature and therefore allowable expenditure u/s 37(1) as has been held by the Hon’ble Supreme Court in the case of Lachmandas Mathurdas vs. CIT [1997 (12) TMI 16 - SUPREME COURT] Disallowance under the head interest on service tax and service tax RCM - HELD THAT:- We note that interest on service tax is an allowable expenditure. Not only that interest on service tax is compensatory in nature and it is not in the nature of penalty therefore the same is allowable expenditure as held by the Hon’ble Supreme Court in the case of Lachmandas Mathuradas (supra). Therefore respectfully following the judgment of the Hon’ble Supreme court, we do not find any infirmity in the order passed by the ld. CIT(A) therefore we confirm the order passed by the ld. CIT(A). - Decided against revenue
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