Bharat Commerce Industries Ltd. v. CIT

230 ITR 733Supreme Court of India1998#790 most cited

What is Bharat Commerce Industries Ltd. v. CIT authority for?

The Supreme Court holds that interest paid under Section 201(1A) of the Income-tax Act, for failure to deduct tax at source, is not an allowable business expenditure under Section 37(1) of the Act.

130

judgments rely on this decision, according to BharatTax’s citation analysis of 366,470 Indian tax judgments — from 2012 to 2026.

Also referred to as

Bharat Commerce Industries Ltd. v. CIT · 230 ITR 733 SC · Section 37(1) · Section 201(1A) · deductibility of interest · interest on TDS default · not allowable business expenditure · interest on statutory dues · disallowance of interest · interest for failure to deduct tax

Sections most often in play

Section 37(1)Section 143(3)Section 201(1A)Section 36(1)(viii)Section 69CSection 90(3)Section 37Section 132
Read the full judgment

Issues it is cited on

section 215section 2(43)section 40(a)(ii)interest under section 201(1a)section 221intra group servicessection 201(1a)section 2(28a)explanation to section 37section 21statutory duesfar analysis

Judgments citing Bharat Commerce Industries Ltd. v. CIT

M/S. Indecomm Global Services (India) Private Limited, Bengaluru vs. Assistant Commissioner of Income Tax, Circle-3(1)(1), Bengaluru

In the result, the appeals filed by the assessee for assessment years 2013-2014 and 2014-2015 are partly allowed, as indicated above

ITA 2800/BANG/2017[2014-15]Status: DisposedITAT Bangalore12 Apr 2022AY 2014-15

Bench: Shri Chandra Poojari, Am & Shri George George K, Jm

For Appellant: Sri.K.R.Vasudevan, AdvocateFor Respondent: Smt.Priyadarshini Besaganni, Addl.CIT-DR
Section 40

…owed as a deductible expenditure only if the ‘service tax’ is claimed as a deduction under Section 37 of the Act and forms part of Profit & Loss (“P&L”) Account of the assessee. The AO has relied on the judgment of Bharat Commerce & Industries Ltd reported in 230 ITR 733 (SC) which has held that “interest paid for committing a default to pay advance tax is not connected with preserving or promoting the business of the assessee. 7 ITA Nos.2799 & 2800/Bang/2017. M/s.Encora Innovation Labs India Pvt.Ltd. 5.1 Aggrieved, assessee raised this issue before the first appellate authority. The CIT(A) held that the receipt…

M/S. Indecomm Global Services (India) Private Limited, Bengaluru vs. Assistant Commissioner of Income Tax, Circle-3(1)(1), Bengaluru

In the result, the appeals filed by the assessee for assessment years 2013-2014 and 2014-2015 are partly allowed, as indicated above

ITA 2799/BANG/2017[2013-14]Status: DisposedITAT Bangalore12 Apr 2022AY 2013-14

Bench: Shri Chandra Poojari, Am & Shri George George K, Jm

For Appellant: Sri.K.R.Vasudevan, AdvocateFor Respondent: Smt.Priyadarshini Besaganni, Addl.CIT-DR
Section 40

…owed as a deductible expenditure only if the ‘service tax’ is claimed as a deduction under Section 37 of the Act and forms part of Profit & Loss (“P&L”) Account of the assessee. The AO has relied on the judgment of Bharat Commerce & Industries Ltd reported in 230 ITR 733 (SC) which has held that “interest paid for committing a default to pay advance tax is not connected with preserving or promoting the business of the assessee. 7 ITA Nos.2799 & 2800/Bang/2017. M/s.Encora Innovation Labs India Pvt.Ltd. 5.1 Aggrieved, assessee raised this issue before the first appellate authority. The CIT(A) held that the receipt…

Rukmani Infra Projects Pvt. Ltd., Bhubaneswar vs. ACIT, Circle-1(2), Bhubaneswar

In the result, the appeal of the assessee is partly allowed for statistical purposes

ITA 358/CTK/2017[2013-14]Status: DisposedITAT Cuttack30 Mar 2022AY 2013-14

Bench: Shri Chandra Mohan Garg, Jm & Shri Arun Khodpia, Am आयकर अपीऱ सं./Ita No.358/Ctk/2017 (नििाारण वषा / Assessment Year :2013-2014) Rukmani Infra Projects Ltd., Vs Acit, Circle-1(2), Bhubaneswar Plot No.251, District Centre, C.S.Pur, Bhubaneswar-16 Pan No. : Aaecr 1585 L (अऩीऱाथी /Appellant) (प्रत्यथी / Respondent) .. यनधागररती की ओर से /Assessee By : None : Shri Manoj Kumar Goutam, Cit-Dr राजस्व की ओर से /Revenue By सुनवाई की तारीख / Date Of Hearing : 08/03/2022 घोषणा की तारीख/Date Of Pronouncement : 30/03/2022 आदेश / O R D E R Per Arun Khodpia, Am : This Appeal Filed By The Assessee Has Been Directed Against The Order Passed By The Ld. Cit(A)-1, Bhubaneswar, Dated 16.06.2017, For The Assessment Year 2013-2014. 2. Brief Facts Of The Case Extracted From The Available Records Are That, The Assessee, A Company Incorporated Under The Companies Act, 1956, Engaged In The Business Of Erection, Commissioning, Technical & Maintenance Service To Different Power Plants. The Return Of Income For The Ay 2013-14 Was Filed By The Assessee On 01.10.2013 Declaring A Total Income Of Rs.1,65,91,030/-. The Case Of The Assessee Was Selected Under Cass. Notice U/S 143(2) & 143(1) Were Issued & Served On The Assessee. Assessment Proceedings Were Completed By The Ao & Concluded With An Addition Of Rs.3,58,95,574/- Under Four Different

For Appellant: None
Section 143(2)Section 68

…on 201(1A) of the Act, therefore, would not assume the character of business expenditure and cannot be regarded as a compensatory payment as contended by learned counsel for the assessee. ii) Bharat Commerce & Industries Ltd vs The Commissioner Of Income Tax 230 ITR 733 Held that “We do not see any reason why any distinction can be made between such interest and interest paid under the Income Tax Act, 1961. Both payments do not have any nexus with the business of the assessee. They are statutory liabilities in respect of the obligations of the assessee which arise under the Income Tax Act and the Voluntary Discl…

Shri. Manuprasad Trivedi, Mumbai vs. DCIT CC 5 (1), Mumbai

In the result, all the appeals of the assessee are partly allowed

ITA 7270/MUM/2019[2014-15]Status: DisposedITAT Mumbai28 Mar 2022AY 2014-15
For Appellant: Jain DixitFor Respondent: S.N. Kabra
Section 143(1)Section 147Section 148Section 69C

…cision of Hon’ble Supreme Court in the case of Laxmandas Mathur Vs. CIT 254 ItR 799 & disallowed the claim of interest on delayed payment of TDS following the decision of Hon’ble Supreme Court in the case of Bharat Commerce and Industires Ltd. Vs. CIT( (1998) 230 ITR 733 and after following the other judicial pronouncement. The relevant part of the decision of the CIT(A) is reproduced as under: “5.5. As regards the interest on delay in payment of TDS, the issues was not before the Apex Court in the case mentioned above. Hon'ble Supreme Court in the case of Bharat Commerce Industries Ltd reported in (1998) 230 IT…

Shalimar Fabricators Pvt Ltd, Kolkata vs. ITO, Ward 6(1), Kolkata

In the result, assessee’s appeal for AY 2017-18 is allowed and the appeal for AY 2018-19 is partly allowed

ITA 428/KOL/2021[2018-19]Status: DisposedITAT Kolkata03 Mar 2022AY 2018-19

Bench: Sri Aby T. Varkey & Sri Manish Borad)

Section 139(1)Section 143(1)Section 234BSection 234CSection 23ASection 36(1)(va)Section 37Section 43BSection 44A

…the assessee. Thus any delay in the payment of TDS by the assessee cannot be linked to the income tax of the assessee and consequently the principles laid down by the Hon’ble Apex Court in the case of Bharat Commerce Industries Ltd. Vs. CIT (1998) reported in 230 ITR 733 cannot be applied to the case on hand. Thus, in our considered view, the principle laid down by the Hon'ble Supreme Court in the case of Bharat Commerce Industries Ltd. (supra) is not applicable in the instant facts of the case. Thus, we hold that the Assessing Officer in the instant case has wrongly applied the principle laid down by the Hon'ble…

Shalimar Fabricators Pvt Ltd, Kolkata vs. ITO, Ward 6(1), Kolkata

In the result, assessee’s appeal for AY 2017-18 is allowed and the appeal for AY 2018-19 is partly allowed

ITA 386/KOL/2021[2017-18]Status: DisposedITAT Kolkata03 Mar 2022AY 2017-18

Bench: Sri Aby T. Varkey & Sri Manish Borad)

Section 139(1)Section 143(1)Section 234BSection 234CSection 23ASection 36(1)(va)Section 37Section 43BSection 44A

…the assessee. Thus any delay in the payment of TDS by the assessee cannot be linked to the income tax of the assessee and consequently the principles laid down by the Hon’ble Apex Court in the case of Bharat Commerce Industries Ltd. Vs. CIT (1998) reported in 230 ITR 733 cannot be applied to the case on hand. Thus, in our considered view, the principle laid down by the Hon'ble Supreme Court in the case of Bharat Commerce Industries Ltd. (supra) is not applicable in the instant facts of the case. Thus, we hold that the Assessing Officer in the instant case has wrongly applied the principle laid down by the Hon'ble…

M/S Ivalue Infosolutions Private Limited, Bangalore vs. Assistant Commissioner of Income Tax Circle-3(1)(1), Bangalore

In the result, the appeal filed by the assessee is partly allowed

ITA 139/BANG/2018[2014-15]Status: DisposedITAT Bangalore09 Feb 2022AY 2014-15

Bench: Shri George George K. & Shri B.R. Baskaranassessment Year: 2014-15

For Appellant: Shri Sarwana Kumar, A.RFor Respondent: Shri Nischal B., D.R
Section 143(3)Section 37(1)

…ITA No.139/Bang/2018 M/s. I Value Infosolutions Pvt. Ltd., Bangalore IN THE INCOME TAX APPELLATE TRIBUNAL “B’’BENCH: BANGALORE BEFORE SHRI GEORGE GEORGE K., JUDICIAL MEMBER AND SHRI B.R. BASKARAN, ACCOUNTANT MEMBER Assessment Year: 2014-15 M/s. I Value Infosolutions Pvt. Ltd. Shree Arcade 1391/16/1 3rd Floor, 19th Main HSR Layout 4th Sector Vs. ACIT Circle-3(1)(1) Bangalore 560 102. Bangalore PAN NO :AABCI8601B APPELLANT RESPONDENT Appellant by : Shri Sarwana Kumar, A.R. Respondent by : Shri Nischal B., D.R. Date of Hearing : 03.01.2022 Date of Pronouncement : 09.02.2022 O R D E R PER B.R. BASKARAN, ACC…

Knr Constructions Limited, Hyderabad vs. Dy. Commissioner of Income Tax, Circle-2(1), Hyderabad

In the result, appeal of the assessee is dismissed

ITA 382/HYD/2020[2016-17]Status: DisposedITAT Hyderabad31 Jan 2022AY 2016-17

Bench: Shri A. Mohan Alankamony & Sri S.S. Godaraa.Y. 2016-17 Knr Constructions Limited, Vs. Dcit, Hyderabad. Circle-2(1), Pan: Aaack 8316 L Hyderabad. (Appellant) (Respondent) Assessee By Sri S. Rama Rao Revenue By Sri T. Sunil Goutam, Sr. Ar Date Of Hearing: 02/12/2021 Date Of Pronouncement: 31/01/2022 Order

Section 143(3)Section 201Section 37(1)

…r the income is determined. This cannot, therefore, be considered as an expenditure for the purpose of earning any income or profits.” 4.1 Similar view was also held by the Hon’ble Apex Court in the case Bharat Commerce and Industries Ltd vs. CIT reported in 230 ITR 733. 5. It is also relevant to note that the provisions of section 201 of the Act stipulates consequence for failure to deduct tax or after deducting remit the same in the Government Treasury. Hence, it is obvious that the interest element merges with the tax and accordingly it partakes the character of tax and not an expenditure incurred for earning…

M/S. Tuv Rheinland Nife Academy Private Limited, Bangalore vs. The Assistant Commissioner of Income Tax, Circle- 7(1)(1), Bangalore

In the result, the appeal of the assessee is treated as partly allowed

ITA 2633/BANG/2019[2016-17]Status: DisposedITAT Bangalore01 Nov 2021AY 2016-17

Bench: Shri B. R. Baskaran & Smt. Beena Pillaiassessment Year: 2016-17

For Appellant: Smt. Kavitha Paramesh, A.RFor Respondent: Shri Muzaffar Hussain &
Section 170Section 201Section 32(1)Section 40Section 47

…ITA No.2633/Bang/2019 TUV Rheinland NIFE Academy Pvt. Ltd., Bangalore IN THE INCOME TAX APPELLATE TRIBUNAL “B’’BENCH: BANGALORE BEFORE SHRI B. R. BASKARAN, ACCOUNTANT MEMBER AND SMT. BEENA PILLAI, JUDICIAL MEMBER Assessment Year: 2016-17 TUV Rheinland NIFE Academy Private Limited No.27/B, 2nd Cross, 13, Konappan Agrahar Begur Hobli Vs. ACIT Circle-7(1)(1) Electronic City Bangalore Bangalore 560 100 PAN NO : AAECT8703A APPELLANT RESPONDENT Appellant by : Smt. Kavitha Paramesh, A.R. Respondent by : Shri Muzaffar Hussain & Shri Priyadarshi Mishra, D.Rs. Date of Hearing : 02.09.2021 Date of Pronouncement : 01.…

Subsea Pro Engineering Private Limited, Mumbai vs. ACIT Circle-16 (3), Mumbai

In the result, appeal is dismissed

ITA 5884/MUM/2019[2015-16]Status: DisposedITAT Mumbai31 Aug 2021AY 2015-16

Bench: Shri Saktijit Dey, Judcial Member & Shri S. Rifaur Rahmanassessment Year: 2015-16 Subsea Pro Engineering Private Assistant Commissioner Of Limited, Income Tax, 509 & 510, Techniplex Ii, Opp Circle 16 (3), Techniplex Complex, Jn. Veer Vs. Room No. 449, Aaykar Bhavan, Savarkar Flyover, Maharashi Karve Road, Goregaon (West), Churchgate- 400020 Mumbai - 400062 Pan: Aapcs6354R (Appellant) (Respondent) Assessee By : Shri Viswas Mehandale (Ar) Revenue By : Shri Vijay Kumar Menon (Dr) Date Of Hearing : 16/07/2021 Date Of Pronouncement: 31/08/2021

For Appellant: Shri Viswas Mehandale (AR)For Respondent: Shri Vijay Kumar Menon (DR)
Section 139Section 201Section 37Section 37(1)

…, interest charged under section 201(1A) cannot be equated with interest charged under sections 215, 220, 234A, 234B and 234C, which are levied on personal tax. Further, he submitted, the ratio laid down in case of Bharat Commerce and Industries Ltd. vs. CIT, 230 ITR 733 (SC) would not be applicable to assessee’s case as the decision was rendered in the context of interest charged under section 139, 215 of the Act. He submitted, on the Assessment Year: 2015-16 contrary there are decisions, wherein interest paid in respect of sales tax, service tax, ESI and Provident Fund have been allowed. In this context, he rel…

M/S Jindal Aluminium Limited, Bangalore vs. Deputy Commissioner of Income Tax (Ltu), Bangalore

In the result, the appeals filed by the assessee for assessment years 2013-2014 and 2015-2016 are allowed for statistical purposes and the appeal filed by the assessee for assessment year 2014-2015...

ITA 33/BANG/2019[2015-16]Status: DisposedITAT Bangalore25 Aug 2021AY 2015-16

Bench: Shri George George K, Jm & Shri B.R.Baskaran, Am

For Appellant: Smt.K.Soumya, AdvocateFor Respondent: SmtH.Kabila, Addl.CIT-DR
Section 244ASection 80I

…er section 201(lA) was charged on the belated payment. Reliance is placed on the decision of Hon'ble Delhi ITAT in Iyer and Sons (P.) Ltd. V. Income-Tax Officer (1982) 1 ITD 502. The Hon'ble Supreme Court in the case of Bharat Commerce & Industry v CIT (1998) 230 ITR 733 held that interest for late payment of direct taxes is not deductible. Similar decision was rendered by the Hon'ble Madras High Court in the case of CIT vs Chennai Properties & Investments Ltd 239 ITR 435. Therefore, Rs.24,644 is added back to the total income of the assessee.” 5.1 The view taken by the Assessing Officer was confirmed by the CIT(…

M/S Jindal Aluminium Limited, Bangalore vs. Deputy Commissioner of Income Tax (Ltu), Bangalore

In the result, the appeals filed by the assessee for assessment years 2013-2014 and 2015-2016 are allowed for statistical purposes and the appeal filed by the assessee for assessment year 2014-2015...

ITA 32/BANG/2019[2014-15]Status: DisposedITAT Bangalore25 Aug 2021AY 2014-15

Bench: Shri George George K, Jm & Shri B.R.Baskaran, Am

For Appellant: Smt.K.Soumya, AdvocateFor Respondent: SmtH.Kabila, Addl.CIT-DR
Section 244ASection 80I

…er section 201(lA) was charged on the belated payment. Reliance is placed on the decision of Hon'ble Delhi ITAT in Iyer and Sons (P.) Ltd. V. Income-Tax Officer (1982) 1 ITD 502. The Hon'ble Supreme Court in the case of Bharat Commerce & Industry v CIT (1998) 230 ITR 733 held that interest for late payment of direct taxes is not deductible. Similar decision was rendered by the Hon'ble Madras High Court in the case of CIT vs Chennai Properties & Investments Ltd 239 ITR 435. Therefore, Rs.24,644 is added back to the total income of the assessee.” 5.1 The view taken by the Assessing Officer was confirmed by the CIT(…

M/S Jindal Aluminium Limited, Bangalore vs. Deputy Commissioner of Income Tax (Ltu), Bangalore

In the result, the appeals filed by the assessee for assessment years 2013-2014 and 2015-2016 are allowed for statistical purposes and the appeal filed by the assessee for assessment year 2014-2015...

ITA 31/BANG/2019[2013-14]Status: DisposedITAT Bangalore25 Aug 2021AY 2013-14

Bench: Shri George George K, Jm & Shri B.R.Baskaran, Am

For Appellant: Smt.K.Soumya, AdvocateFor Respondent: SmtH.Kabila, Addl.CIT-DR
Section 244ASection 80I

…er section 201(lA) was charged on the belated payment. Reliance is placed on the decision of Hon'ble Delhi ITAT in Iyer and Sons (P.) Ltd. V. Income-Tax Officer (1982) 1 ITD 502. The Hon'ble Supreme Court in the case of Bharat Commerce & Industry v CIT (1998) 230 ITR 733 held that interest for late payment of direct taxes is not deductible. Similar decision was rendered by the Hon'ble Madras High Court in the case of CIT vs Chennai Properties & Investments Ltd 239 ITR 435. Therefore, Rs.24,644 is added back to the total income of the assessee.” 5.1 The view taken by the Assessing Officer was confirmed by the CIT(…

Hari Machines Ltd., New Delhi vs. DCIT, New Delhi

The appeal is dismissed

ITA 213/DEL/2017[2012-13]Status: DisposedITAT Delhi03 Aug 2021AY 2012-13

Bench: Shri Kul Bharat & Shri Prashant Maharishi(Through Video Conferencing) Hari Machines Ltd, Vs. Dcit, 4, Scindia House, Connaught Circle-11(1), Place, New Delhi New Delhi Pan: Aaach0868C (Appellant) (Respondent)

For Appellant: NoneFor Respondent: Ms. Anima Barnwal, Sr. DR
Section 143(3)Section 234BSection 37(1)

…ny manner alter the character of the payment, namely, its character as income tax. 9. Learned counsel for the Revenue submitted placing strong reliance on the recent decision of the Supreme Court in the case of Bharat Commerce and Industries Ltd. v. CIT[1998] 230 ITR 733, that payments required to be made by way of income-tax'under the Income-tax Act are not deductible as expenditure and the further amounts which a person may be required to pay by a reason of failure to comply with the provisions requiring the payments of the tax are also amounts which cannot be regarded as deductible expenditure under Section 37…

Hari Machines Ltd., New Delhi vs. DCIT, Circle-11(1), New Delhi

In the result ground number 3-4 are allowed with above directions

ITA 6948/DEL/2017[2014-15]Status: DisposedITAT Delhi14 Jul 2021AY 2014-15

Bench: Shri Sudhanshu Srivastava & Shri Prashant Maharishi(Through Video Conferencing) Hari Machines Ltd, Vs. Dcit, 4, Scindia House, Connaught Circle-11(1), Place, New Delhi New Delhi Pan: Aaach0868C (Appellant) (Respondent)

For Appellant: NoneFor Respondent: Ms. Anima, Sr. DR
Section 143(3)Section 30Section 37(1)

…e deductees therefore, it is not an liability of the Assessee hence, it is not a tax liability and only compensatory in nature. The ld AO relied upon the decision of the Hon’ble Madras High Court 239 ITR 435 as well as decision of the Hon’ble Supreme Court in 230 ITR 733 and the decision of the ld CIT(A) in Assessee’s own case for Assessment Year 2012-13 confirmed disallowances of the above payment. The ld CIT(A) also confirmed the above disallowances. 7. On carefully consideration of the issue we find that the Assessee has deposited the tax deducted at source from various payees but has not deposited the same in…

ACIT, New Delhi vs. Smt. Sahara India Life Insurance Coy. Ltd., Lucknow

In the result, the appeal filed by the Revenue is partly allowed

ITA 224/DEL/2017[2014-15]Status: DisposedITAT Delhi30 Jun 2021AY 2014-15

Bench: Shri R.K. Panda & Shri Sudhanshu Srivastavaassessment Year: 2014-15 Acit, Vs Sahara India Life Insurance Co. Ltd., Central Circle-1, R/O Kapoorthala Complex, New Delhi. Aliganj, Lucknow. Pan: Aahcs1334B (Appellant) (Respondent) Assessee By : Shri Aditya Vohra, Advocate Revenue By : Mrs. Aashna Paul, Cit, Dr Date Of Hearing : 25.05.2021 Date Of Pronouncement : 30.06.2021

For Appellant: Shri Aditya Vohra, AdvocateFor Respondent: Mrs. Aashna Paul, CIT, DR
Section 28Section 44

…IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : D : NEW DELHI BEFORE SHRI R.K. PANDA, ACCOUNTANT MEMBER AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER Assessment Year: 2014-15 ACIT, Vs Sahara India Life Insurance Co. Ltd., Central Circle-1, R/o Kapoorthala Complex, New Delhi. Aliganj, Lucknow. PAN: AAHCS1334B (Appellant) (Respondent) Assessee by : Shri Aditya Vohra, Advocate Revenue by : Mrs. Aashna Paul, CIT, DR Date of Hearing : 25.05.2021 Date of Pronouncement : 30.06.2021 ORDER PER R.K. PANDA, AM: This appeal filed by the Revenue is directed against the order dated 15.11.2016 of the CIT(A)-23, New Delh…

Iris Associates Pvt. Ltd., New Delhi vs. Addl.CIT, Special Range- 4, New Delhi

The appeal of the assessee stands dismissed

ITA 7548/DEL/2017[2014-15]Status: DisposedITAT Delhi21 Jun 2021AY 2014-15

Bench: The Assessing

…not an item of expenditure. In the above said judgment, the Hon’ble Madras High Court also referred to the judgment of the Hon’ble Apex Court in the case of Bharat Commerce Industries Ltd. Iris Associates Private Limited Vs. ACIT vs. CIT reported in [1998] 230 ITR 733 wherein the Hon’ble Apex Court has rejected the arguments advanced by the assessee that retention of money payable to the State as tax or Income Tax would augment the capital of the assessee and the expenditure incurred towards the normal interest paid for the period of such retention would assume character of business expenditure. The Hon’bl…

ACIT, Circle-7(1), New Delhi vs. Danisco (India) Pvt. Ltd., Gurgaon

Accordingly, this ground raised by the Revenue is also dismissed

ITA 6025/DEL/2019[2013-14]Status: DisposedITAT Delhi05 May 2021AY 2013-14

Bench: Shri Amit Shukla & Shri Prashant Maharishi

For Appellant: Shri Harpreet Singh Ajmani, Adv. &For Respondent: Shri Dheeraj Jain, Sr.D.R

…tem of expenditure. The amount not deducted and remitted has the character of tax and has to be remitted to the State and cannot be utilised by the assessee for its own business. The Supreme Court in the case of Bharat Commerce & Industries Ltd. v. CIT [1998] 230 ITR 733/ 98 Taxman 151rejected the argument that retention of money payable to the State as tax or income-tax would augment the capital of the assessee and the 33 I.T.As. No.3518/DEL/2017 & 7896 to 7899/DEL/2018 expenditure incurred, namely, interest paid for the period of such retention, would assume the character of business expenditure. It held that…

Danisco India Pvt. Ltd., Gurugram vs. DCIT, Circle-7(1), New Delhi

Accordingly, this ground raised by the Revenue is also dismissed

ITA 5203/DEL/2019[2013-14]Status: DisposedITAT Delhi05 May 2021AY 2013-14

Bench: Shri Amit Shukla & Shri Prashant Maharishi

For Appellant: Shri Harpreet Singh Ajmani, Adv. &For Respondent: Shri Dheeraj Jain, Sr.D.R

…tem of expenditure. The amount not deducted and remitted has the character of tax and has to be remitted to the State and cannot be utilised by the assessee for its own business. The Supreme Court in the case of Bharat Commerce & Industries Ltd. v. CIT [1998] 230 ITR 733/ 98 Taxman 151rejected the argument that retention of money payable to the State as tax or income-tax would augment the capital of the assessee and the 33 I.T.As. No.3518/DEL/2017 & 7896 to 7899/DEL/2018 expenditure incurred, namely, interest paid for the period of such retention, would assume the character of business expenditure. It held that…

ACIT, Circle-7(1), New Delhi vs. Danisco India Pvt. Ltd., Gurugram

Accordingly, this ground raised by the Revenue is also dismissed

ITA 7899/DEL/2018[2012-13]Status: DisposedITAT Delhi05 May 2021AY 2012-13

Bench: Shri Amit Shukla & Shri Prashant Maharishi

For Appellant: Shri Harpreet Singh Ajmani, Adv. &For Respondent: Shri Dheeraj Jain, Sr.D.R

…tem of expenditure. The amount not deducted and remitted has the character of tax and has to be remitted to the State and cannot be utilised by the assessee for its own business. The Supreme Court in the case of Bharat Commerce & Industries Ltd. v. CIT [1998] 230 ITR 733/ 98 Taxman 151rejected the argument that retention of money payable to the State as tax or income-tax would augment the capital of the assessee and the 33 I.T.As. No.3518/DEL/2017 & 7896 to 7899/DEL/2018 expenditure incurred, namely, interest paid for the period of such retention, would assume the character of business expenditure. It held that…