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| The Tax Publishers2020 TaxPub(DT) 3769 (Pune-Trib) INCOME TAX ACT, 1961
Section 37(1)
Where assessee had submitted that the entire liability on account of penal interest charged by RBI for non-maintenance of SLR and CRR was accepted by the assessee-bank and the same having been arisen and crystallized during the year, therefore, CIT(A) was fully justified in allowing the claim of the assessee for deduction even on account of provision made on account of penal interest charged by RBI.
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Business expenditure - Peanl interest - Penal interst charged by RBI for non-maintenance of SLR and CRR -
The case of assessee was selected for scrutiny and notice under section 143(2) was issued by AO, which was duly served on assessee-bank. During the course of assessment proceedings, the revised return of income was filed by assessee in which deduction, inter-alia, was claimed on account of penal interest charged by RBI for non-maintenance of SLR and CRR. Since the revised return filed by the assessee was beyond the period of one year from the end of relevant assessment year, AO considered the same as invalid and proceeded to complete the assessment by not allowing the claim of the assessee for deduction on account of penal interest charged. Held: Assessee had submitted that the entire liability on account of penal interest charged by RBI for non-maintenance of SLR and CRR was accepted by the assessee-bank and the same having been arisen and crystallized during the year. CIT(A) was fully justified in allowing the claim of the assessee for deduction even on account of provision made on account of penal interest charged by RBI. There was no infirmity in order of CIT(A) allowing the claim of assessee for deduction on account of penal interest paid to RBI for non-maintenance of SLR and CRR including especially the provision made.
Followed:Goetze (India) Ltd. v. CIT (2006) 284 ITR 323 (SC) : 2006 TaxPub(DT) 1528 (SC) CIT v. Deogiri Nagari Sahakari Bank Ltd. 2015 TaxPub(DT) 3300 (Bom-HC) DCIT v. Dhanalakshmi Bank Ltd. (2002) 76 TTJ 439 (Coch-Trib) : 2002 TaxPub(DT) 0111 (Coch-Trib)Relied:Bank of America v. JCIT [ITA No.4408/Mum/2000 dated 27-11-2013 ] : 2014 TaxPub(DT) 2660 (Mum-Trib)
REFERRED :
FAVOUR : In assessee's favour
A.Y. :
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