TMI Blog2021 (9) TMI 877X X X X Extracts X X X X X X X X Extracts X X X X ..... ty separately. Hence payment of interest on delayed remittance of TDS could not be construed as penal in nature. We find that the reliance in this regard has been rightly placed on case of DCIT vs Rungta Mines Ltd [ 2018 (10) TMI 672 - ITAT KOLKATA ] which dealt with the similar issue of punitive charges paid to Railways for overloading of wagons as an allowable expenditure being compensatory in nature - we direct the ld AO to grant deduction for interest on delayed payment of TDS - Decided in favour of assessee. Disallowance of project expenditure at 10% on an adhoc basis - HELD THAT:- We find that the lower authorities had not given any finding with regard to the aforesaid details filed by the assessee and had simply resorted to ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the assessee had claimed the interest paid on late payment of TDS of ₹ 1,87,125/- as deduction u/s 37(1) of the Act on the plea that the delay in remittance of TDS had suffered interest which is compensatory in nature. The ld AO however held to be penal in nature and by applying the Explanation to section 37(1) of the Act, disallowed the said sum of ₹ 1,87,125/- in the assessment, which was also confirmed by the ld CITA. We find that the genuinity of the expenditure incurred is not in dispute. Admittedly the TDS was duly deducted and remitted with delay by the assessee and for the said delay , the assessee had suffered interest. The expenditure incurred by the assessee for the purpose of business is not doubted by the reve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... diture at 10% thereon amounting to ₹ 6,97,498/- on an adhoc basis in the facts and circumstances of the case. 3.1. We have heard the rival submissions and perused the materials available on record. We find that the assessee during the year had incurred project expenditure of ₹ 69,74,976/-. Out of this expenditure, only ₹ 850/- was paid by cash and balance expenditure was incurred by cheque. The details were furnished to the ld AO during the course of assessment proceedings together with the explanations thereon. We also find from the details that the assessee had paid a sum of ₹ 62,16,608/- by cheque to the Municipality; ₹ 4,38,590/- by cheque to Reliance Energy Ltd ; ₹ 4,000/- paid by cheque to Survey ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SI Premium etc were paid to Brihan Mumbai Mahanagari Palika and evidences for expenses like receipts given by MCGM and copy of ledger account are attached to the paper book. All the payments were made through account payee cheques. 2 Electricity Charges 438590/- All the expenses were paid through account payee cheques and the copy of the ledger account, electricity bills are attached with the paper book. All the payments were made through account payee cheques. 3 Survey Charges 4000/- The copy of the ledger account, bills are attached with the paper book. All the payments were made through account payee che ..... X X X X Extracts X X X X X X X X Extracts X X X X
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