TMI Blog2009 (12) TMI 1034X X X X Extracts X X X X X X X X Extracts X X X X ..... After considering relevant statutory provisions, it was held that it was compensatory and therefore, a permissible deduction. We have examined relevant provisions of section 75 and are of the view that interest paid for the delayed payment of service-tax is compensatory and has the same character as service-tax. There is no dispute that service-tax is a permissible deduction. In our opinion, the interest should also be allowed in the same manner. In the light of above discussion, we uphold the order of CIT(A) on ground No. 1. Nature of expenditure - Enduring benefit in acquiring logo - business deduction or not? - whether by making payment in question, the assessee has acquired any enduring benefit - HELD THAT:- It is quite evident fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue expenditure ignoring the fact that the assessee will get long-term benefit out of this expenditure. 3. The facts relating to deletion of addition of ₹ 36,588 are that the assessee made late payment of service-tax and accordingly had to pay above amount as interest under section 75 of the Finance Act, 1994 relating to service-tax provisions. The AO treated above amount as a penalty and disallowed the same. However, on appeal, learned C1T(A) held that payment made was of compensatory nature and therefore, permissible as a business deduction. He deleted the disallowance. 4. In the appellate proceedings before us, the learned Departmental Representative submitted that payment of interest on delayed payment of service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee in Hyderabad. The AO held that assessee had acquired an enduring benefit in acquiring logo and, therefore, allowed only part of the expenses. On further appeal, CIT(A) held that payment was made for use of logo in trade fairs only and there was no enduring benefit to the assessee. He therefore allowed the amount as a business deduction. The Revenue is aggrieved and has brought the issue in appeal. The short controversy between the parties as noted above is whether by making payment in question, the assessee has acquired any enduring benefit. On facts and evidence on record, we are of the view that finding recorded by learned CIT(A) is unassailable. It would be relevant to reproduce confirmation issued by Messee Dusseldorf GmbH f ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
