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2021 (4) TMI 997 - AT - Income TaxDelayed payments of employees contribution to PF as u/s.36(1)(va) r.w.s 2(24)(x) or u/s 43B - HELD THAT:- Considering the submissions of the parties that the issue raised in present appeal is covered by the decisions of Hon'ble Jurisdictional High Court in CIT Vs GSRTC [2014 (1) TMI 502 - GUJARAT HIGH COURT] wherein it was held that sec. 43B of the Act is not applicable for the delayed payments of employees contribution to PF as under section 36(1)(va) r.w.s 2(24)(x) of the Act. In the light of above discussion and facts and circumstances and judicial decision Hon`ble High Court we upheld the addition made by the ld.AO, accordingly appeal of the assessee is dismissed. In the result, Ground No.1 of the appeal is dismissed. Interest paid to NBFC Kotak Mahindra Pvt. Ltd - assessee submits that the recipient of the interest has paid tax on the interest, therefore this ground of appeal may be restored to the file of the Assessing Officer (AO) for verification of facts, if the recipient has paid tax on the interest received by them than the AO be directed not to made the addition against the assessee - HELD THAT:- Considering the submissions by both the parties and the fact the ld.AR of the assessee submitted that recipient has already paid tax on the interest received, therefore, we restore the issue to the file of the AO to verify the facts if the recipient had paid the tax on the interest paid by the assessee, no disallowance be made against the assessee. Therefore, the A.O. is directed to verify the facts and pass the order afresh in accordance with Law. The assessee is directed to provide all necessary information and documents to the AO, accordingly this ground no.2 is allowed for statistical purpose. Disallowance of interest paid on TDS - assessee submits that the interest paid by the assessee is not a penalty and compensatory in nature and is allowable deduction under section 37 - HELD THAT:- Hon’ble Apex Court in Prakash Cotton Mills Vs CIT [1993 (4) TMI 3 - SUPREME COURT] held that whenever any statutory impost paid by an assessee by way of damages or penalty or interest is claimed as an allowable expenditure under section 37(1), the assessing authority is required to examine the scheme of the provisions of the relevant statute providing for the payment of such impost notwithstanding the nomenclature of the impost as given by the statute, to find whether it is compensatory or penal in nature. The authority has to allow deduction under section 37(1) wherever such examination reveals the concerned impost to be purely compensatory in nature. Considering the fact that the assessee has paid interest of TDS, which is statutory impost, paid by the assessee and is compensatory in nature and thus is allowable deduction. Hence, we direct the AO to allow the interest paid by assessee on TDS. In the result, the ground No. 3 is allowed. Disallowance u/s.14A - assessee submits that during the financial year relevant to the assessment period under consideration, the assessee has not shown any exempt income, therefore there should not be any disallowance under section 14A - HELD THAT:- As relying on Cheminvest Ltd. [2009 (8) TMI 126 - ITAT DELHI-B] considering the fact the A.O. has not identified any exempt income earned by the assessee during the year, thus the A.O. was not justified in making disallowance under section 14A. Ground No. 4 of the appeal is allowed.
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