Velankani Information Systems Ltd. v. DCIT

97 Taxmann.com 599Income Tax Appellate Tribunal2018#4908 most cited

What is Velankani Information Systems Ltd. v. DCIT authority for?

Interest paid on delayed remittances of service tax is compensatory in nature and not a penalty hit by the Explanation to Section 37(1) of the Income Tax Act, 1961, making it a allowable business expenditure.

24

judgments rely on this decision, according to BharatTax’s citation analysis of 366,339 Indian tax judgments — from 2019 to 2025.

Also referred to as

Velankani Information Systems Ltd. v DCIT · section 37(1) · business expenditure · interest on delayed payment of service tax · compensatory nature · penalty · Explanation to section 37(1)

Also reported as

173 ITD 19

Sections most often in play

Section 201(1A)Section 37(1)Section 143(3)Section 36(1)(viii)Section 90(3)Section 35(1)(ii)Section 40A(2)(a)Section 40A(2)(b)

Issues it is cited on

section 90(3)section 10(2)(xv)explanation to section 37interest under section 201(1a)section 10(2)section 36(1)(viii)prohibited by lawsection 201(1a)section 129credit for tdscomputer softwaresection 37(1)

Judgments citing Velankani Information Systems Ltd. v. DCIT

New Modern Bazaar Departmental Store Pvt. Ltd., New Delhi vs. ITO, Ward- 31(1), New Delhi

In the result, appeal of the assessee is dismissed

ITA 590/DEL/2018[2014-15]Status: DisposedITAT Delhi08 Apr 2021AY 2014-15

Bench: Shri Amit Shuklaa N D Shri Prashant Maharishi(Through Video Conferencing)

For Appellant: N O N EFor Respondent: Shri S. S. Negi, Sr. DR
Section 143(3)Section 201Section 37Section 37(1)

…INCOME TAX APPELLATE TRIBUNAL [ DELHI BENCH “E”: NEW DELHI ] BEFORE SHRI AMIT SHUKLA, JUDICIAL MEMBER A N D SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER (Through Video Conferencing) ITA. No. 590/Del/2018 (Assessment Year: 2014-15) M/s. New Modern Bazaar ITO, Departmental Store Pvt. Ltd., Vs. 18–B, Basant Lok, Vasant Vihar, Ward : 31 (1) New Delhi – 110 057. PAN: AAECM3446L New Delhi. (Appellant) (Respondent) Assessee by : N O N E; Department by: Shri S. S. Negi, Sr. DR; Date of Hearing : 05/04/2021 Date of pronouncement : 08/04/2021 O R D E R PER PRASHANT MAHARISHI, A. M. 1. This appeal is filed by the assessee…

M/S. Timken Engineering and Rsearch India Private Limited, Bengaluru vs. Assistant Commissioner of Income Tax, Circle-12(4), Bengaluru

In the result, both the appeals of the assessee are treated as partly allowed

ITA 162/BANG/2019[2010-11]Status: DisposedITAT Bangalore29 Apr 2020AY 2010-11

Bench: Shri B. R. Baskaran & Smt. Beena Pillai

For Appellant: Shri AliasgarRampurwala, A.RFor Respondent: Shri Priyadarshi Mishra, D.R
Section 234BSection 40

…y, we restore this issue to the file of the A.O. The remaining amount relates to interest paid on belated payment of Service tax. The Ld. A.R. placed reliance on the decision of Bangalore bench of ITAT in the case of Velankani Informations Systems Ltd. (2018) 173 ITD 19, wherein the coordinate bench has taken the view that the interest paid on delated deposit of service tax is not penal in nature and is eligible for deduction u/s 37(1) of the Act. Following the above said decision, we set aside the order passed by the Ld. CIT(A) and direct the A.O. to allow deduction of interest paid on service tax. 23. We shall…

M/S. Timken Engineering and Research India Private Limited, Bengaluru vs. Deputy Commissioner of Income Tax, Circle-12(4), Bengaluru

In the result, both the appeals of the assessee are treated as partly allowed

ITA 161/BANG/2019[2009-10]Status: DisposedITAT Bangalore29 Apr 2020AY 2009-10

Bench: Shri B. R. Baskaran & Smt. Beena Pillai

For Appellant: Shri AliasgarRampurwala, A.RFor Respondent: Shri Priyadarshi Mishra, D.R
Section 234BSection 40

…y, we restore this issue to the file of the A.O. The remaining amount relates to interest paid on belated payment of Service tax. The Ld. A.R. placed reliance on the decision of Bangalore bench of ITAT in the case of Velankani Informations Systems Ltd. (2018) 173 ITD 19, wherein the coordinate bench has taken the view that the interest paid on delated deposit of service tax is not penal in nature and is eligible for deduction u/s 37(1) of the Act. Following the above said decision, we set aside the order passed by the Ld. CIT(A) and direct the A.O. to allow deduction of interest paid on service tax. 23. We shall…

M/S Fitwel Tools & Forgings Private Limited, Tumkur vs. Assistant Commissioner of Income Tax Circle-3(1)(1), Bangalore

In the result, the appeal filed by the assessee is treated as allowed for statistical purposes

ITA 449/BANG/2018[2014-15]Status: DisposedITAT Bangalore04 Sept 2019AY 2014-15

Bench: Shri N.V Vasudevan, Vice Presidnet & Shri B.R Baskaranassessment Year : 2014-15

For Appellant: Shri Bharath L, C.AFor Respondent: Dr. P.V Pradeep Kumar, Addl. CIT
Section 3(3)Section 37Section 37(1)

…aid to govt. for delay in payment of CESS and it would not be described as penalty for Page 3 of 7 infringement of law. The ld AR also placed his reliance on the decision rendered by co-ordinate bench in the case of Velankani Information systems Ltd., (2018) 97 Taxmann.com 599 [ITAT] wherein it was held that interest paid on delayed remittance of service tax was only compensatory in nature and would not be in the nature of penalty attracting the Explanation to sec. 37(1). 5. We heard the ld DR on this issue and perused the record. We noticed that this issue is squarely covered by the decision rendered by Hon’bl…