Haji Aziz & Abdul Shakoor Bros. v. CIT

41 ITR 350Supreme Court of India1961#1634 most cited

What is Haji Aziz & Abdul Shakoor Bros. v. CIT authority for?

Penalties paid for a breach of law or contravention of statutory provisions are not allowable deductions as business expenditure because they cannot be considered wholly and exclusively laid out for the purpose of the business. This principle is now enshrined in Explanation 1 to Section 37(1) of the Income-tax Act, 1961.

69

judgments rely on this decision, according to BharatTax’s citation analysis of 366,339 Indian tax judgments — from 2016 to 2026.

Also referred to as

Haji Aziz & Abdul Shakoor Bros. · 41 ITR 350 · Section 37(1) · Section 10(2)(xv) · penalty for breach of law · business expenditure deduction · wholly and exclusively · redemption fine · prohibited by law · statutory contravention · Explanation 1 to Section 37(1)

Also reported as

41 CTR 350

Sections most often in play

Section 37(1)Section 132Section 132(1)Section 132(3)Section 132(4)Section 139Section 143(3)Section 144
Read the full judgment

Issues it is cited on

section 226section 14a(1)section 211explanation to section 37prohibited by lawsection 135section 114section 115japeriod of holdinginterest on securitiessection 139(5)section 21

Judgments citing Haji Aziz & Abdul Shakoor Bros. v. CIT

Cineyug Worldwide, Mumbai vs. DCIT CC 3(1), Mumbai

In the result, appeal of the assessee is allowed

ITA 4225/MUM/2018[2013-14]Status: DisposedITAT Mumbai20 Sept 2019AY 2013-14

Bench: Shri S. Rifaur Rahman & Shri Ram Lal Negi: A.Y : 2013-14

For Appellant: Shri Shubham Rathi &For Respondent: Shri Kumar Padmapani Bora
Section 143(2)Section 143(3)Section 37Section 43B

…that he had to expend the said amount, though it was not his primary liability. Be that as it may, this cannot be stated to be a penalty for infraction of law. Reference to the decision of Supreme Court in case of Haji Aziz & Abdul Shakoor Bros. v. CIT [1961] 41 ITR 350 therefore is not of any help to the Revenue. It was a case in which the assessee had imported dates from Iraq, at a time when such import was prohibited. Due to this, the dates imported by the assessee by steamers were confiscated by the customs 5 M/s. Cineyug Worldwide authorities. The assessee was given an option to pay redemption fine and have…

DCIT, C-5, Ludhiana vs. M/S Satyam Auto Components Ltd., Ludhiana

In the result, both the appeals of the Revenue are hereby

ITA 589/CHANDI/2018[2012-13]Status: DisposedITAT Chandigarh10 Jul 2019AY 2012-13

Bench: Shri N.K. Saini & Shrisanjay Gargआयकरअपीलसं./Ita No. 1500/Chd/2017 "नधा"रणवष" / Assessment Year : 2011-12 The Dcit, Circle-5, Vs. M/S Satyam Auto Components Ludhiana Pvt Ltd., G.T.Road, Hero बनाम Nagar, Ludhiana

For Appellant: Sh. Manjit Singh, CIT DRFor Respondent: Sh. Subhash Aggarwal, Advocate
Section 36

…ture under consideration has been incurred for keeping the trade going and making it pay. On this preposition, the learned AR of the assessee company relied upon the decision of the Honorable Apex Court in the case of Hazi Aziz and Abdul Shakoor Bros. Vs. CIT 41 ITR 350 (SC). It has again been submitted that the Assessing Officer has wrongly presumed that the training is to change the manufacturing system whereas there was no change in the manufacturing system or manufacturing process. It has again been submitted that the objective of training was only to educate the workers by explaining the different processes…

DCIT, C-5, Ludhiana vs. M/S Satyam Auto Components Ltd., Ludhiana

In the result, both the appeals of the Revenue are hereby

ITA 1500/CHANDI/2017[2011-12]Status: DisposedITAT Chandigarh10 Jul 2019AY 2011-12

Bench: Shri N.K. Saini & Shrisanjay Gargआयकरअपीलसं./Ita No. 1500/Chd/2017 "नधा"रणवष" / Assessment Year : 2011-12 The Dcit, Circle-5, Vs. M/S Satyam Auto Components Ludhiana Pvt Ltd., G.T.Road, Hero बनाम Nagar, Ludhiana

For Appellant: Sh. Manjit Singh, CIT DRFor Respondent: Sh. Subhash Aggarwal, Advocate
Section 36

…ture under consideration has been incurred for keeping the trade going and making it pay. On this preposition, the learned AR of the assessee company relied upon the decision of the Honorable Apex Court in the case of Hazi Aziz and Abdul Shakoor Bros. Vs. CIT 41 ITR 350 (SC). It has again been submitted that the Assessing Officer has wrongly presumed that the training is to change the manufacturing system whereas there was no change in the manufacturing system or manufacturing process. It has again been submitted that the objective of training was only to educate the workers by explaining the different processes…

The ACIT, Thiruvalla vs. M/S.Muthoot Properties & Investments, Kozhencherry

In the result, the appeals of the Revenue are partly allowed for statistical

ITA 75/COCH/2018[2005-06]Status: HeardITAT Cochin21 Feb 2019AY 2005-06

Bench: S/Shri Chandra Poojari, Am & George George K., Jm

Section 143(3)Section 37(1)Section 45Section 57

…bring the gross receipts to tax, he can only tax profits of a trade or business. That cannot be done without deducting losses and the legitimate expenses of the business." 6. Reliance was placed by the revenue on Haji Aziz & Abdul Shakoor Bros. v. CIT (1961) 41 ITR 350(SC). In that case, however, the assesses carried on the Lawful business of importing dates from abroad and selling them in India. The import of dates by steamer was prohibited. Nonetheless, he imported dates from Iraq by steamer, and the consignments were confiscated by the customs authorities. But the dates were released subsequently on I.T.A. No…

DCIT, Thiruvalla vs. Muthoot Properties & Investments, Kozhencherry

In the result, the appeals of the Revenue are partly allowed for statistical

ITA 74/COCH/2018[2003-04]Status: HeardITAT Cochin21 Feb 2019AY 2003-04

Bench: S/Shri Chandra Poojari, Am & George George K., Jm

Section 143(3)Section 37(1)Section 45Section 57

…bring the gross receipts to tax, he can only tax profits of a trade or business. That cannot be done without deducting losses and the legitimate expenses of the business." 6. Reliance was placed by the revenue on Haji Aziz & Abdul Shakoor Bros. v. CIT (1961) 41 ITR 350(SC). In that case, however, the assesses carried on the Lawful business of importing dates from abroad and selling them in India. The import of dates by steamer was prohibited. Nonetheless, he imported dates from Iraq by steamer, and the consignments were confiscated by the customs authorities. But the dates were released subsequently on I.T.A. No…

The ACIT, Thiruvalla vs. M/S.Muthoot Properties & Investments, Kozhencherry

In the result, the appeals of the Revenue are partly allowed for statistical

ITA 73/COCH/2018[2002-03]Status: HeardITAT Cochin21 Feb 2019AY 2002-03

Bench: S/Shri Chandra Poojari, Am & George George K., Jm

Section 143(3)Section 37(1)Section 45Section 57

…bring the gross receipts to tax, he can only tax profits of a trade or business. That cannot be done without deducting losses and the legitimate expenses of the business." 6. Reliance was placed by the revenue on Haji Aziz & Abdul Shakoor Bros. v. CIT (1961) 41 ITR 350(SC). In that case, however, the assesses carried on the Lawful business of importing dates from abroad and selling them in India. The import of dates by steamer was prohibited. Nonetheless, he imported dates from Iraq by steamer, and the consignments were confiscated by the customs authorities. But the dates were released subsequently on I.T.A. No…

DCIT, Thiruvalla vs. Mar Gregorious Memorial Muthoot Medical Centre, Kozhencherry

In the result, the appeals of the Revenue are partly allowed for statistical

ITA 72/COCH/2018[2007-08]Status: HeardITAT Cochin21 Feb 2019AY 2007-08

Bench: S/Shri Chandra Poojari, Am & George George K., Jm

Section 143(3)Section 37(1)Section 45Section 57

…bring the gross receipts to tax, he can only tax profits of a trade or business. That cannot be done without deducting losses and the legitimate expenses of the business." 6. Reliance was placed by the revenue on Haji Aziz & Abdul Shakoor Bros. v. CIT (1961) 41 ITR 350(SC). In that case, however, the assesses carried on the Lawful business of importing dates from abroad and selling them in India. The import of dates by steamer was prohibited. Nonetheless, he imported dates from Iraq by steamer, and the consignments were confiscated by the customs authorities. But the dates were released subsequently on I.T.A. No…

DCIT, Thiruvalla vs. Mar Gregorious Memorial Muthoot Medical Centre, Kozhencherry

In the result, the appeals of the Revenue are partly allowed for statistical

ITA 71/COCH/2018[2004-05]Status: HeardITAT Cochin21 Feb 2019AY 2004-05

Bench: S/Shri Chandra Poojari, Am & George George K., Jm

Section 143(3)Section 37(1)Section 45Section 57

…bring the gross receipts to tax, he can only tax profits of a trade or business. That cannot be done without deducting losses and the legitimate expenses of the business." 6. Reliance was placed by the revenue on Haji Aziz & Abdul Shakoor Bros. v. CIT (1961) 41 ITR 350(SC). In that case, however, the assesses carried on the Lawful business of importing dates from abroad and selling them in India. The import of dates by steamer was prohibited. Nonetheless, he imported dates from Iraq by steamer, and the consignments were confiscated by the customs authorities. But the dates were released subsequently on I.T.A. No…

DCIT, Thiruvalla vs. Mar Gregorious Memorial Muthoot Medical Centre, Kozhencherry

In the result, the appeals of the Revenue are partly allowed for statistical

ITA 70/COCH/2018[2003-04]Status: HeardITAT Cochin21 Feb 2019AY 2003-04

Bench: S/Shri Chandra Poojari, Am & George George K., Jm

Section 143(3)Section 37(1)Section 45Section 57

…bring the gross receipts to tax, he can only tax profits of a trade or business. That cannot be done without deducting losses and the legitimate expenses of the business." 6. Reliance was placed by the revenue on Haji Aziz & Abdul Shakoor Bros. v. CIT (1961) 41 ITR 350(SC). In that case, however, the assesses carried on the Lawful business of importing dates from abroad and selling them in India. The import of dates by steamer was prohibited. Nonetheless, he imported dates from Iraq by steamer, and the consignments were confiscated by the customs authorities. But the dates were released subsequently on I.T.A. No…

The ACIT, Circle-1, Thiruvalla vs. Mar Gregorious Memorial Muthoot Medical Centre, Pathanamthitta

In the result, the appeals of the Revenue are partly allowed for statistical

ITA 69/COCH/2018[2002-03]Status: HeardITAT Cochin21 Feb 2019AY 2002-03

Bench: S/Shri Chandra Poojari, Am & George George K., Jm

Section 143(3)Section 37(1)Section 45Section 57

…bring the gross receipts to tax, he can only tax profits of a trade or business. That cannot be done without deducting losses and the legitimate expenses of the business." 6. Reliance was placed by the revenue on Haji Aziz & Abdul Shakoor Bros. v. CIT (1961) 41 ITR 350(SC). In that case, however, the assesses carried on the Lawful business of importing dates from abroad and selling them in India. The import of dates by steamer was prohibited. Nonetheless, he imported dates from Iraq by steamer, and the consignments were confiscated by the customs authorities. But the dates were released subsequently on I.T.A. No…

Ashok Mohanbahi Patel, Mumbai vs. Deputy Commissioner of Income Tax Central Circle-2(4), Mumbai

The appeals of the assessee are dismissed

ITA 154/MUM/2018[2013-14]Status: DisposedITAT Mumbai19 Sept 2018AY 2013-14

Bench: Shri Joginder Singh & Shri Rajesh Kumar

Section 132Section 30Section 37

…आयकर अपील"य अ"धकरण, मुंबई "यायपीठ, ‘बी’,मुंबई। IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, ‘B’ MUMBAI "ी जो"ग"दर "संह, "या"यक सद"य एवं "ी राजेश कुमार, लेखा सद"य, के सम" Before Shri Joginder Singh, Judicial Member, and Shri Rajesh Kumar, Accountant Member ITA Nos.150 to 154 & 166/Mum/2018 Assessment Years: 2008-09 to 2013-14 Ashok Mohanbhai Patel, DCIT, R. No.19, 1st Floor, Central Circle-2(4), बनाम/ 142 F Lalwani Haveli, 802, Old. CGO Bld.(Annexe), Vs. Kabutarkhanna, 8th Floor, Bhuleshwar, M. K. Road, Mumbai-400002 Mumbai-400020 ("नधा"रती /Assessee) (राज"व /Revenue) PAN. No.ARQPP9049K "नधा"रती क" ओर स…

Ashok Mohanbahi Patel, Mumbai vs. Deputy Commissioner of Income Tax Central Circle-2(4), Mumbai

The appeals of the assessee are dismissed

ITA 153/MUM/2018[2012-13]Status: DisposedITAT Mumbai19 Sept 2018AY 2012-13

Bench: Shri Joginder Singh & Shri Rajesh Kumar

Section 132Section 30Section 37

…आयकर अपील"य अ"धकरण, मुंबई "यायपीठ, ‘बी’,मुंबई। IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, ‘B’ MUMBAI "ी जो"ग"दर "संह, "या"यक सद"य एवं "ी राजेश कुमार, लेखा सद"य, के सम" Before Shri Joginder Singh, Judicial Member, and Shri Rajesh Kumar, Accountant Member ITA Nos.150 to 154 & 166/Mum/2018 Assessment Years: 2008-09 to 2013-14 Ashok Mohanbhai Patel, DCIT, R. No.19, 1st Floor, Central Circle-2(4), बनाम/ 142 F Lalwani Haveli, 802, Old. CGO Bld.(Annexe), Vs. Kabutarkhanna, 8th Floor, Bhuleshwar, M. K. Road, Mumbai-400002 Mumbai-400020 ("नधा"रती /Assessee) (राज"व /Revenue) PAN. No.ARQPP9049K "नधा"रती क" ओर स…

Ashok Mohanbahi Patel, Mumbai vs. Deputy Commissioner of Income Tax Central Circle-2(4), Mumbai

The appeals of the assessee are dismissed

ITA 152/MUM/2018[2010-11]Status: DisposedITAT Mumbai19 Sept 2018AY 2010-11

Bench: Shri Joginder Singh & Shri Rajesh Kumar

Section 132Section 30Section 37

…आयकर अपील"य अ"धकरण, मुंबई "यायपीठ, ‘बी’,मुंबई। IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, ‘B’ MUMBAI "ी जो"ग"दर "संह, "या"यक सद"य एवं "ी राजेश कुमार, लेखा सद"य, के सम" Before Shri Joginder Singh, Judicial Member, and Shri Rajesh Kumar, Accountant Member ITA Nos.150 to 154 & 166/Mum/2018 Assessment Years: 2008-09 to 2013-14 Ashok Mohanbhai Patel, DCIT, R. No.19, 1st Floor, Central Circle-2(4), बनाम/ 142 F Lalwani Haveli, 802, Old. CGO Bld.(Annexe), Vs. Kabutarkhanna, 8th Floor, Bhuleshwar, M. K. Road, Mumbai-400002 Mumbai-400020 ("नधा"रती /Assessee) (राज"व /Revenue) PAN. No.ARQPP9049K "नधा"रती क" ओर स…

Ashok Mohanbahi Patel, Mumbai vs. Deputy Commissioner of Income Tax Central Circle-2(4), Mumbai

The appeals of the assessee are dismissed

ITA 151/MUM/2018[2009-10]Status: DisposedITAT Mumbai19 Sept 2018AY 2009-10

Bench: Shri Joginder Singh & Shri Rajesh Kumar

Section 132Section 30Section 37

…आयकर अपील"य अ"धकरण, मुंबई "यायपीठ, ‘बी’,मुंबई। IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, ‘B’ MUMBAI "ी जो"ग"दर "संह, "या"यक सद"य एवं "ी राजेश कुमार, लेखा सद"य, के सम" Before Shri Joginder Singh, Judicial Member, and Shri Rajesh Kumar, Accountant Member ITA Nos.150 to 154 & 166/Mum/2018 Assessment Years: 2008-09 to 2013-14 Ashok Mohanbhai Patel, DCIT, R. No.19, 1st Floor, Central Circle-2(4), बनाम/ 142 F Lalwani Haveli, 802, Old. CGO Bld.(Annexe), Vs. Kabutarkhanna, 8th Floor, Bhuleshwar, M. K. Road, Mumbai-400002 Mumbai-400020 ("नधा"रती /Assessee) (राज"व /Revenue) PAN. No.ARQPP9049K "नधा"रती क" ओर स…

Ashok Mohanbahi Patel, Mumbai vs. Deputy Commissioner of Income Tax Central Circle-2(4), Mumbai

The appeals of the assessee are dismissed

ITA 150/MUM/2018[2008-09]Status: DisposedITAT Mumbai19 Sept 2018AY 2008-09

Bench: Shri Joginder Singh & Shri Rajesh Kumar

Section 132Section 30Section 37

…आयकर अपील"य अ"धकरण, मुंबई "यायपीठ, ‘बी’,मुंबई। IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, ‘B’ MUMBAI "ी जो"ग"दर "संह, "या"यक सद"य एवं "ी राजेश कुमार, लेखा सद"य, के सम" Before Shri Joginder Singh, Judicial Member, and Shri Rajesh Kumar, Accountant Member ITA Nos.150 to 154 & 166/Mum/2018 Assessment Years: 2008-09 to 2013-14 Ashok Mohanbhai Patel, DCIT, R. No.19, 1st Floor, Central Circle-2(4), बनाम/ 142 F Lalwani Haveli, 802, Old. CGO Bld.(Annexe), Vs. Kabutarkhanna, 8th Floor, Bhuleshwar, M. K. Road, Mumbai-400002 Mumbai-400020 ("नधा"रती /Assessee) (राज"व /Revenue) PAN. No.ARQPP9049K "नधा"रती क" ओर स…

DCIT, CC-1(3), Kolkata vs. M/S Feegrade & Company Ltd., Kolkata

In the result the appeal by the revenue is dismissed

ITA 1654/KOL/2016[2013-14]Status: DisposedITAT Kolkata10 Jan 2018AY 2013-14

Bench: Hon’Ble Shri N.V.Vasudevan, Jm & Shri Waseem Ahmed, Am ] Assessment Year : 2013-14

For Appellant: Shri Arindam Bhattacharjee, Addl.CITFor Respondent: Shri Subash Agarwal, Advocate
Section 143(3)Section 3Section 37(1)Section 73

…was paid for the purpose of compounding a criminal offence and was therefore hit by the provision of Explanation to section 37(1) of the Act. Reference was also made to the decision of the Hon’ble Supreme Court in the case of Haji Aziz & Abdul Brothers vs CIT 41 ITR 350 (SC) . In the aforesaid case fine paid to customs authorities for release of confiscated goods imported contrary to law was held to be not allowable as deduction u/s 37(1) of the Act. 13. The ld. Counsel for the assessee placed reliance on the decision of the ITAT, Kolkata Bench in the case of DCIT vs M/s. Feegrade & Company Pvt. Ltd. In IT(SS) A.…

DCIT, CC-1(3), Kolkata vs. M/S Rungta Mines Ltd., Kolkata

In the result the appeal by the revenue is dismissed

ITA 1653/KOL/2016[2013-14]Status: DisposedITAT Kolkata10 Jan 2018AY 2013-14

Bench: Hon’Ble Shri N.V.Vasudevan, Jm & Shri Waseem Ahmed, Am ] Assessment Year : 2013-14

For Appellant: Shri A.K.Tiwari, CITFor Respondent: Shri Subash Agarwal, Advocate
Section 143(3)Section 3Section 37(1)Section 73

…was paid for the purpose of compounding a criminal offence and was therefore hit by the provision of Explanation to section 37(1) of the Act. Reference was also made to the decision of the Hon’ble Supreme Court in the case of Haji Aziz & Abdul Brothers vs CIT 41 ITR 350 (SC) . In the aforesaid case fine paid to customs authorities for release of confiscated goods imported contrary to law was held to be not allowable as deduction u/s 37(1) of the Act. 13. The ld. Counsel for the assessee placed reliance on the decision of the ITAT, Kolkata Bench in the case of DCIT vs M/s. Feegrade & Company Pvt. Ltd. In IT(SS) A…

DCIT, CC-193, Kolkata vs. M/S Rungta Sons Private Ltd., Kolkata

In the result the appeal by the revenue is dismissed

ITA 1652/KOL/2016[2013-14]Status: DisposedITAT Kolkata10 Jan 2018AY 2013-14

Bench: Hon’Ble Shri N.V.Vasudevan, Jm & Shri Waseem Ahmed, Am ] Assessment Year : 2013-14

For Appellant: Shri Arindam Bhattacharjee, Addl. CITFor Respondent: Shri Subash Agarwal, Advocate
Section 143(3)Section 3Section 37(1)Section 73

…was paid for the purpose of compounding a criminal offence and was therefore hit by the provision of Explanation to section 37(1) of the Act. Reference was also made to the decision of the Hon’ble Supreme Court in the case of Haji Aziz & Abdul Brothers vs CIT 41 ITR 350 (SC) . In the aforesaid case fine paid to customs authorities for release of confiscated goods imported contrary to law was held to be not allowable as deduction u/s 37(1) of the Act. 13. The ld. Counsel for the assessee placed reliance on the decision of the ITAT, Kolkata Bench in the case of DCIT vs M/s. Feegrade & Company Pvt. Ltd. In IT(SS) A…

DCIT, New Delhi vs. M/S. Bokaro Power Supply Co. Ltd., New Delhi

In the result, appeal of the assessee is partly allowed whereas the appeal of the Revenue is dismissed

ITA 3692/DEL/2014[2010-11]Status: DisposedITAT Delhi31 Oct 2017AY 2010-11

Bench: Sh. Amit Shukla & Sh. O.P. Kantassessment Year: 2010-11 Vs. Dcit, Circle -3(1), New Delhi M/S. Bokaro Power Supply Co. Ltd., Ispat Bhavan, Lodhi Road, New Delhi Pan : Aabcb8976G (Appellant) (Respondent) & Assessment Year: 2010-11 Vs. M/S. Bokaro Power Supply Co. Dcit, Circle -3(1), New Delhi Ltd., 4Th Floor, Ispat Bhavan, Lodhi Road, New Delhi Pan : Aabcb8976G (Appellant) (Respondent) Assessee By Sh. M.P. Rastogi, Adv. & Sh. Anil Sharma, Agm Respondent By Sh. Sandip Kumar Mishra, Sr.Dr Date Of Hearing 11.10.2017 Date Of Pronouncement 31.10.2017 Order Per O.P. Kant, A.M.:

Section 143(2)Section 143(3)Section 43B

…t of tax within the meaning of Section 43B. However, Penal Interest is in the nature of penalty for infraction of law & therefore, cannot be allowed otherwise, as per the expenditure to Section 37(1) of the Act. In Haji Aziz & Abdul Shakoor Bros Vs. CIT(1961) 41 ITR 350 (SC), it was held that a penalty imposed for breach of any law during the course of trade etc., cannot be described as a commercial loss. If a sum is paid by an assessee conducting his business, because in conducting it he has acted in a manner which has rendered him liable to penalty, it cannot be claimed as a deductible expense. Infraction of la…

Bokaro Power Supply Co. Ltd., New Delhi vs. DCIT, New Delhi

In the result, appeal of the assessee is partly allowed whereas the appeal of the Revenue is dismissed

ITA 3405/DEL/2014[2010-11]Status: DisposedITAT Delhi31 Oct 2017AY 2010-11

Bench: Sh. Amit Shukla & Sh. O.P. Kantassessment Year: 2010-11 Vs. Dcit, Circle -3(1), New Delhi M/S. Bokaro Power Supply Co. Ltd., Ispat Bhavan, Lodhi Road, New Delhi Pan : Aabcb8976G (Appellant) (Respondent) & Assessment Year: 2010-11 Vs. M/S. Bokaro Power Supply Co. Dcit, Circle -3(1), New Delhi Ltd., 4Th Floor, Ispat Bhavan, Lodhi Road, New Delhi Pan : Aabcb8976G (Appellant) (Respondent) Assessee By Sh. M.P. Rastogi, Adv. & Sh. Anil Sharma, Agm Respondent By Sh. Sandip Kumar Mishra, Sr.Dr Date Of Hearing 11.10.2017 Date Of Pronouncement 31.10.2017 Order Per O.P. Kant, A.M.:

Section 143(2)Section 143(3)Section 43B

…t of tax within the meaning of Section 43B. However, Penal Interest is in the nature of penalty for infraction of law & therefore, cannot be allowed otherwise, as per the expenditure to Section 37(1) of the Act. In Haji Aziz & Abdul Shakoor Bros Vs. CIT(1961) 41 ITR 350 (SC), it was held that a penalty imposed for breach of any law during the course of trade etc., cannot be described as a commercial loss. If a sum is paid by an assessee conducting his business, because in conducting it he has acted in a manner which has rendered him liable to penalty, it cannot be claimed as a deductible expense. Infraction of la…