Lachmandas Mathura v. CIT

254 ITR 799Supreme Court of India2002#885 most cited

What is Lachmandas Mathura v. CIT authority for?

Interest paid on delayed payment of statutory dues, such as sales tax, service tax, TDS, and GST, is compensatory in nature rather than penal. Consequently, such interest is an allowable deduction in computing business profits.

119

judgments rely on this decision, according to BharatTax’s citation analysis of 366,314 Indian tax judgments — from 2010 to 2026.

Also referred to as

Lachmandas Mathura v. CIT · 254 ITR 799 · Section 37(1) · interest on delayed payment · statutory dues · compensatory interest · penal interest · allowable deduction · business expenditure · sales tax interest · service tax interest · TDS interest · GST interest

Sections most often in play

Section 143(3)Section 37(1)Section 132Section 36(1)(iii)Section 143(2)Section 153ASection 1961Section 201(1A)

Issues it is cited on

section 215section 226section 2(43)explanation to section 37section 40(a)(ii)section 2(28a)section 14a(1)statutory duessection 211interest under section 201(1a)prohibited by lawsection 21

Judgments citing Lachmandas Mathura v. CIT

Dy. Commissioner of Income Tax, Circle-16(2), Hyderabad vs. Plr Projects Private Limited, Hyderabad

The appeal is allowed and question Nos

ITA 615/HYD/2019[2013-14]Status: DisposedITAT Hyderabad21 Sept 2021AY 2013-14

Bench: Shri S.S. Godara & Shri L. P. Sahu(Through Virtual Hearing) Assessment Year : 2013-14 Dy.Cit, Circle 16(2) Vs. Plr Projects Private Limited Hyderabad Hyderabad [Pan: Aadcp9069L] [Appellant] [Respondent]

For Appellant: Shri Rohit Mujumdar, DRFor Respondent: Shri Pawan Kumar Chakrapani, AR
Section 154Section 37Section 75

…wable under the provisions of section 37 of the Act. 3 ITA No. 615Hyd/2019 PLR Projects Pvt. Ltd, Hyd. 6.1. The issue of delay in the payments of service tax is directly covered by the judgment of Hon'ble Apex Court in the case of Lachmandas Mathura Vs. CIT 254 ITR 799 in favour of assessee. The relevant extract of the judgment is reproduced below: "The High Court has proceeded on the basis that the interest on arrears of sales tax is penal in nature and has rejected the contention of the assessee that it is compensatory in nature. In taking the said view the High Court has placed reliance on its Full Bench 5…

Cargotec India Pvt Ltd., Navi Mumbai vs. Asst CIT 15(1)(2), Mumbai

In the result, the appeal of the assessee in ITA No

ITA 399/MUM/2020[2013-14]Status: DisposedITAT Mumbai18 Aug 2021AY 2013-14
Section 143(3)Section 37(1)

…IN THE INCOME TAX APPELLATE TRIBUNAL, ‘C‘ BENCH MUMBAI BEFORE: SHRI VIKAS AWASTHY, JUDICIAL MEMBER & SHRI M.BALAGANESH, ACCOUNTANT MEMBER ITA No.400/Mum/2020 (Assessment Year :2010-11) & M/s. Cargotec India Pvt. Ltd Vs. The Assistant Commissioner We-Work of Income Tax-15(1)(2) 11th Floor, 11C-140 to 146 Mumbai Tower 1, Seawoods Grand Central, Sector – 40 Seawoods Navi Mumbai PAN/GIR No.AABCH8289A (Appellant) .. (Respondent) Assessee by Shri Ketan Ved Revenue by Ms. Shreekala Pardeshi Date of Hearing 11/08/2021 Date of Pronouncement 18/08/2021 आदेश / O R D E R PER M. BALAGANESH (A.M): This appeal in ITA No…

M/S Inflow Technologies Private Limited, Bangalore vs. The Deputy Commissioner of Income Tax Circle-3(1)(1), Bangalore

In the result, ground Nos

ITA 3339/BANG/2018[2014-15]Status: DisposedITAT Bangalore04 Aug 2021AY 2014-15

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

For Appellant: Sri.Nitish Ranjan, CAFor Respondent: Sri.Pradeep Kumar, CIT-DR

…ahalakshmi Sugar Mills Co. vs. CIT, 123 ITR 429(SC) have held that interest for delay payment of statutory dues is an allowable deduction u/s.37(1) of the Act. Same view has also been taken by Hon’ble Supreme Court in the case of Lachmandas Mathuradas vs CIT, 254 ITR 799(sc). We also find that Hon’ble Allahabad High Court in the case of Commissioner of Income-tax v. Ishwari Khetan Sugar Mills (Pvt.) Ltd.,272 ITR 224(All) have held that interest on delayed payment of provident fund is an allowable deduction u/s.37(1) of the Act. Hon’ble Delhi High Court in the case of Commissioner of Income-tax v. Delhi Automobile…

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

In the result, ground Nos

ITA 3338/BANG/2018[2013-14]Status: DisposedITAT Bangalore04 Aug 2021AY 2013-14

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

For Appellant: Sri.Nitish Ranjan, CAFor Respondent: Sri.Pradeep Kumar, CIT-DR

…ahalakshmi Sugar Mills Co. vs. CIT, 123 ITR 429(SC) have held that interest for delay payment of statutory dues is an allowable deduction u/s.37(1) of the Act. Same view has also been taken by Hon’ble Supreme Court in the case of Lachmandas Mathuradas vs CIT, 254 ITR 799(sc). We also find that Hon’ble Allahabad High Court in the case of Commissioner of Income-tax v. Ishwari Khetan Sugar Mills (Pvt.) Ltd.,272 ITR 224(All) have held that interest on delayed payment of provident fund is an allowable deduction u/s.37(1) of the Act. Hon’ble Delhi High Court in the case of Commissioner of Income-tax v. Delhi Automobile…

DCIT, New Delhi vs. M/S. Central Warehousing Corp., New Delhi

In the result, all the appeals filed by the Revenue, i

ITA 5784/DEL/2014[2010-11]Status: DisposedITAT Delhi31 May 2021AY 2010-11

Bench: Shri O.P. Kant, Accountantmember & Shri K.N. Chary[Through Video Conferencing]

Section 139(5)Section 143(1)Section 36

…IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: ‘B’ NEW DELHI BEFORE SHRI O.P. KANT, ACCOUNTANTMEMBER AND SHRI K.N. CHARY, JUDICIAL MEMBER [Through Video Conferencing] ITA No.3885/Del./2011 Assessment Year: 2006-07 Central Warehousing Vs. ACIT, Corporation, Circle-3(1), Warehousing Bhawan, 4/1, C.R. Building, Siri Institutional Area, New Delhi Hauz Khas, August Kranti Marg, New Delhi PAN :AAACC1206D (Appellant) (Respondent) AND ITA No.3942/Del./2011 Assessment Year: 2006-07 DCIT, Vs. Central Warehousing Circle-3(1), Corporation, C.R. Building, Warehousing Bhawan, 4/1, New Delhi Siri Institutional Area, Hauz…

DCIT, New Delhi vs. M/S. Central Warehousing Corp., New Delhi

In the result, all the appeals filed by the Revenue, i

ITA 3440/DEL/2014[2008-09]Status: DisposedITAT Delhi31 May 2021AY 2008-09

Bench: Shri O.P. Kant, Accountantmember & Shri K.N. Chary[Through Video Conferencing]

Section 139(5)Section 143(1)Section 36

…IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: ‘B’ NEW DELHI BEFORE SHRI O.P. KANT, ACCOUNTANTMEMBER AND SHRI K.N. CHARY, JUDICIAL MEMBER [Through Video Conferencing] ITA No.3885/Del./2011 Assessment Year: 2006-07 Central Warehousing Vs. ACIT, Corporation, Circle-3(1), Warehousing Bhawan, 4/1, C.R. Building, Siri Institutional Area, New Delhi Hauz Khas, August Kranti Marg, New Delhi PAN :AAACC1206D (Appellant) (Respondent) AND ITA No.3942/Del./2011 Assessment Year: 2006-07 DCIT, Vs. Central Warehousing Circle-3(1), Corporation, C.R. Building, Warehousing Bhawan, 4/1, New Delhi Siri Institutional Area, Hauz…

DCIT, New Delhi vs. M/S. Central Warehousing Corp., New Delhi

In the result, all the appeals filed by the Revenue, i

ITA 3439/DEL/2014[2007-08]Status: DisposedITAT Delhi31 May 2021AY 2007-08

Bench: Shri O.P. Kant, Accountantmember & Shri K.N. Chary[Through Video Conferencing]

Section 139(5)Section 143(1)Section 36

…IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: ‘B’ NEW DELHI BEFORE SHRI O.P. KANT, ACCOUNTANTMEMBER AND SHRI K.N. CHARY, JUDICIAL MEMBER [Through Video Conferencing] ITA No.3885/Del./2011 Assessment Year: 2006-07 Central Warehousing Vs. ACIT, Corporation, Circle-3(1), Warehousing Bhawan, 4/1, C.R. Building, Siri Institutional Area, New Delhi Hauz Khas, August Kranti Marg, New Delhi PAN :AAACC1206D (Appellant) (Respondent) AND ITA No.3942/Del./2011 Assessment Year: 2006-07 DCIT, Vs. Central Warehousing Circle-3(1), Corporation, C.R. Building, Warehousing Bhawan, 4/1, New Delhi Siri Institutional Area, Hauz…

M/S. Central Warehousing Corporation, New Delhi vs. DCIT, New Delhi

In the result, all the appeals filed by the Revenue, i

ITA 2201/DEL/2014[2009-10]Status: DisposedITAT Delhi31 May 2021AY 2009-10

Bench: Shri O.P. Kant, Accountantmember & Shri K.N. Chary[Through Video Conferencing]

Section 139(5)Section 143(1)Section 36

…IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: ‘B’ NEW DELHI BEFORE SHRI O.P. KANT, ACCOUNTANTMEMBER AND SHRI K.N. CHARY, JUDICIAL MEMBER [Through Video Conferencing] ITA No.3885/Del./2011 Assessment Year: 2006-07 Central Warehousing Vs. ACIT, Corporation, Circle-3(1), Warehousing Bhawan, 4/1, C.R. Building, Siri Institutional Area, New Delhi Hauz Khas, August Kranti Marg, New Delhi PAN :AAACC1206D (Appellant) (Respondent) AND ITA No.3942/Del./2011 Assessment Year: 2006-07 DCIT, Vs. Central Warehousing Circle-3(1), Corporation, C.R. Building, Warehousing Bhawan, 4/1, New Delhi Siri Institutional Area, Hauz…

DCIT, New Delhi vs. M/S. Central Warehousing Corporation, New Delhi

In the result, all the appeals filed by the Revenue, i

ITA 3942/DEL/2011[2006-07]Status: DisposedITAT Delhi31 May 2021AY 2006-07

Bench: Shri O.P. Kant, Accountantmember & Shri K.N. Chary[Through Video Conferencing]

Section 139(5)Section 143(1)Section 36

…IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: ‘B’ NEW DELHI BEFORE SHRI O.P. KANT, ACCOUNTANTMEMBER AND SHRI K.N. CHARY, JUDICIAL MEMBER [Through Video Conferencing] ITA No.3885/Del./2011 Assessment Year: 2006-07 Central Warehousing Vs. ACIT, Corporation, Circle-3(1), Warehousing Bhawan, 4/1, C.R. Building, Siri Institutional Area, New Delhi Hauz Khas, August Kranti Marg, New Delhi PAN :AAACC1206D (Appellant) (Respondent) AND ITA No.3942/Del./2011 Assessment Year: 2006-07 DCIT, Vs. Central Warehousing Circle-3(1), Corporation, C.R. Building, Warehousing Bhawan, 4/1, New Delhi Siri Institutional Area, Hauz…

Central Warehousing Corporation, New Delhi vs. ACIT, New Delhi

In the result, all the appeals filed by the Revenue, i

ITA 3885/DEL/2011[2006-07]Status: DisposedITAT Delhi31 May 2021AY 2006-07

Bench: Shri O.P. Kant, Accountantmember & Shri K.N. Chary[Through Video Conferencing]

Section 139(5)Section 143(1)Section 36

…IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: ‘B’ NEW DELHI BEFORE SHRI O.P. KANT, ACCOUNTANTMEMBER AND SHRI K.N. CHARY, JUDICIAL MEMBER [Through Video Conferencing] ITA No.3885/Del./2011 Assessment Year: 2006-07 Central Warehousing Vs. ACIT, Corporation, Circle-3(1), Warehousing Bhawan, 4/1, C.R. Building, Siri Institutional Area, New Delhi Hauz Khas, August Kranti Marg, New Delhi PAN :AAACC1206D (Appellant) (Respondent) AND ITA No.3942/Del./2011 Assessment Year: 2006-07 DCIT, Vs. Central Warehousing Circle-3(1), Corporation, C.R. Building, Warehousing Bhawan, 4/1, New Delhi Siri Institutional Area, Hauz…

Golden Arrow Travels Private Limited, Shillong vs. Income Tax Officer, Ward-1, Shillong

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

ITA 233/GTY/2019[2016-17]Status: DisposedITAT Guwahati17 Jun 2020AY 2016-17

Bench: Shri A. T. Varkey, Jm & Dr. A. L. Saini, Am]

Section 194JSection 40

…res integra. This Tribunal in Narayani Ispat P. Ltd. has decided this issue by holding as under: The issue of delay in the payment of service tax is directly covered by the judgment of Hon'ble Apex Court in the case of Lachmandas Mathura Vs. CIT reported in 254 ITR 799 in favour of assessee. The relevant extract of the judgment is reproduced below: "The High Court has proceeded on the basis that the interest on arrears of sales tax is penal in nature and has rejected the contention of the assessee that it is compensatory in nature. In taking the said view the High Court has placed reliance on its Full Bench's d…

DCIT, Trivandrum vs. Asianet Satellite Communications Ltd, Trivandrum

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

ITA 662/COCH/2019[2010-11]Status: DisposedITAT Cochin20 Feb 2020AY 2010-11

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

…hmi Sugar Mills Co. vs. CIT (1980) (123 ITR 429) where it was held that the interest for delayed payment of statutory dues is an allowable deduction u/s. 37(1) of the Act. The same view was taken by Supreme Court in the case of Lachmandas Mathurdas vs. CIT (254 ITR 799). Similarly, in the recent decision of the Cochin Bench of the Tribunal in the case of Lakshdweep 6 I.T.A. Nos. 661&662/Coch/2019 Development Corporation Limited in ITA No. 312/Coch/2019 dated 03/10/2018, the Tribunal has held that interest on delayed payment of VAT and TDS is only compensatory and is not penal in nature. Therefore, the CIT(A)…

DCIT, Trivandrum vs. Asianet Satellite Communications Ltd, Trivandrum

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

ITA 661/COCH/2019[2007-08]Status: DisposedITAT Cochin20 Feb 2020AY 2007-08

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

…hmi Sugar Mills Co. vs. CIT (1980) (123 ITR 429) where it was held that the interest for delayed payment of statutory dues is an allowable deduction u/s. 37(1) of the Act. The same view was taken by Supreme Court in the case of Lachmandas Mathurdas vs. CIT (254 ITR 799). Similarly, in the recent decision of the Cochin Bench of the Tribunal in the case of Lakshdweep 6 I.T.A. Nos. 661&662/Coch/2019 Development Corporation Limited in ITA No. 312/Coch/2019 dated 03/10/2018, the Tribunal has held that interest on delayed payment of VAT and TDS is only compensatory and is not penal in nature. Therefore, the CIT(A)…

Shri Vikram Singh Shekhawat, Jaipur vs. Deputy Commissioner of Income Tax, Circle, Sikar

In the result, the appeals filed by the assessee in ITA No

ITA 484/JPR/2019[2013-14]Status: DisposedITAT Jaipur23 Jan 2020AY 2013-14
For Appellant: Shri Shrawan Kumar Gupta, AdvocateFor Respondent: Shri K.C. Gupta, JCIT DR
Section 143(3)Section 145(3)Section 154Section 234A

…such the interest on delayed payment is not in the nature of penalty in the instant case on hand. The issue of delay in the payment of service tax is directly covered by the judgment of Hon’ble Apex Court in the case of Lachmandas Mathura Vs. CIT reported in 254 ITR 799 in favour of assessee. The relevant extract of the judgment is reproduced below : “The High Court has proceeded on the basis that the interest on arrears of sales tax is penal in nature and has rejected the contention of the assessee that it is compensatory in nature. In taking the said view the High Court has placed reliance on its Full Bench's…

M/S Perfect Turners, Jaipur vs. Deputy Commissioner of Income Tax, Circle-4, Jaipur

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

ITA 1115/JPR/2019[2016-17]Status: DisposedITAT Jaipur23 Jan 2020AY 2016-17
For Appellant: Shri S.L. Poddar, AdvocateFor Respondent: Shri K.C. Gupta, JCIT DR
Section 143(3)Section 2(24)(x)Section 36(1)(va)

…37. Therefore it is clear that when any statutory dues are paid delayed and interest is paid for delayed payment then it is compensatory in nature and allowable expenditure for business u/s 37 of the Income Tax Act, 1961. In the case Lachmandas Mathura v. CIT 254 ITR 799 the Apex Court has held that “The High Court has proceeded on the basis that the interest on arrears of sales tax is penal in nature and has rejected the contention of the assessee that it is compensatory in nature. In taking the said view the High Court has placed reliance on its Full Bench’s decision in Saraya Sugar Mills (P) Ltd. v. CIT (1979)…

DCIT, Central Circle - 2(4), Kolkata vs. M/S. Maa Annapurna Transport Agency Ltd., Kolkata

In the result, the appeal of revenue is dismissed

ITA 822/KOL/2018[2013-14]Status: DisposedITAT Kolkata15 Jan 2020AY 2013-14

Bench: Shri A.T. Varkery, Jm & Dr. Arjun Lal Saini, Am ]

Section 133(6)Section 68

…res integra. This Tribunal in Narayani Ispat P. Ltd. has decided this issue by holding as under: The issue of delay in the payment of service tax is directly covered by the judgment of Hon'ble Apex Court in the case of Lachmandas Mathura Vs. CIT reported in 254 ITR 799 in favour of assessee. The relevant extract of the judgment is reproduced below: "The High Court has proceeded on the basis that the interest on arrears of sales tax is penal in nature and has rejected the contention of the assessee that it is compensatory in nature. In taking the said view the High Court has placed reliance on its Full Bench's d…

Banpal Oil Chem Pvt.Ltd., Palanpur vs. The ACIT, B.K.Circle, Palanpur

In the result, the appeal of the asessee is partly allowed

ITA 1939/AHD/2014[2009-10]Status: DisposedITAT Ahmedabad21 Oct 2019AY 2009-10
For Appellant: Shri Tushar Hemani &For Respondent: Shri Mudit Nagpal, Sr. D.R
Section 143(3)Section 14ASection 37(1)Section 80I

…t of Rs. 15,88,600/- charged by the sales tax department as interest on purchase tax liability. The ld. counsel has also placed reliance on the decision of Prakash Cotton Mills Pvt. Ltd. vs. CIT (1993) 201 ITR 684 (SC) and Lachmandas Mathuradas Vs. CIT (2002) 254 ITR 799 (SC). On the other hand, ld. departmental representative has supported the order of ld. CIT(A). 10. We have heard the rival contentions and perused the material on record. With the assistance of ld. representatives, we have perused the page I.T.A No. 1939/Ahd/2014 A.Y. 2009-10 Page No 5 Banpal Oilchem Pvt. Ltd. vs. ACIT no. 23 of the paper boo…

Vagad Builders and Developers Pvt. Ltd., Mumbai vs. ITO 15 (3)(2), Mumbai

In the result, appeal filed by the assesse is treated as allowed for statistical purpose

ITA 5468/MUM/2018[2015-16]Status: DisposedITAT Mumbai15 Oct 2019AY 2015-16

Bench: Shri Mahavir Singh & Shri G. Manjunathavagad Builders & Vs. Ito-15(3)(2) Developers Pvt. Ltd. Aaykar Bhawan M.K.Road 230, Big Splash, Sector-17 Mumbai-400 020 Vashi Navi Mumbai-400 703

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

…IN THE INCOME TAX APPELLATE TRIBUNAL “SMC”, BENCH MUMBAI BEFORE SHRI MAHAVIR SINGH, JUDICIAL MEMBER & SHRI G. MANJUNATHA, ACCOUNTANT MEMBER Vagad Builders and Vs. ITO-15(3)(2) Developers Pvt. Ltd. Aaykar Bhawan M.K.Road 230, Big Splash, Sector-17 Mumbai-400 020 Vashi Navi Mumbai-400 703 PAN/GIR No.AADCV0768J Appellant) .. Respondent) Revenue by Akhtar H. Ansari Assessee by Roshan Ochani Date of Hearing 15/10/2019 Date of Pronouncement 15/10/2019 आदेश आदेश / O R D E R आदेश आदेश PER BENCH: This appeal filed by the assessee is directed against, the order of the Commissioner of Income Tax (Appeals)–24, Mumba…

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

…dia (P.) Ltd., 271 CTR 591 (Guj.) and further he submitted that in the following cases also, interest on late payment of statutory dues were allowed by various courts :- i) Mahalakshmi Sugar Mills Co. vs CIT, 123 ITR 429 (SC) ii) Lachmandas Mathurdas vs CIT, 254 ITR 799 (SC) iii) CIT vs Ishwari Khetan Sugar Mills Pvt. Ltd., 272 ITR 224 (All) iv) CIT vs Delhi Automobiles, 272 ITR 381 (Delhi) v) Euro RSCG Advertising (P.) Ltd. vs ACIT, (2012) 53 SOT 90 (Mumbai) vi) Chander K. Raichandani vs ACIT, ITA No. 799/Mum/2012 dated 08.02.2013 5. On the other hand, the ld. DR supported the order of the ld. CIT(A). 6. Cons…

DCIT, Corporate Citcle -3(2), Chennai vs. Vsl India Pvt.Ltd., Chennai

In the result, the appeal of Revenue is dismissed

ITA 138/CHNY/2018[2012-13]Status: DisposedITAT Chennai08 Aug 2019AY 2012-13

Bench: Shri Inturi Rama Rao & Shri Duvvuru Rl Reddy] आयकर अपील सं./I.T.A. No.138/Chny/2018. "नधा$रण वष$ /Assessment Year :2012-13

For Appellant: Mr.R.Clement Ramesh KumarFor Respondent: Mr.T.Vasudevan,Advocate
Section 143(3)Section 75

…ter-IV of the Finance Act,1994, held that interest on delayed payment of service tax is only compensatory in nature placing reliance in the following decisions, i) Mahalakshmi Sugar Mills Co. Vs.C.I.T in (1980) 123 ITR 429 (SC) ii) Lachmanda Mathuradas in 254 ITR 799 (SC) iii) Swadeshi Cotton Mills Ltd., Vs. 233 ITR 199 (SC), :- 4 -: directed the Assessing Officer to delete the addition of interest on delayed payment of Service Tax. Being aggrieved with the order of the ld.CIT(A), the Revenue is before us in the present appeal. 4. Before us, ld. Senior D.R placed reliance on the orders of the lower authorit…