{"id":867,"date":"2009-08-19T16:00:18","date_gmt":"2009-08-19T16:00:18","guid":{"rendered":"http:\/\/itatonline.org\/archives\/?p=867"},"modified":"2009-08-19T16:00:18","modified_gmt":"2009-08-19T16:00:18","slug":"western-coalfields-vs-acit-itat-mumbai","status":"publish","type":"post","link":"https:\/\/itatonline.org\/archives\/western-coalfields-vs-acit-itat-mumbai\/","title":{"rendered":"Western Coalfields vs. ACIT (ITAT Nagpur)"},"content":{"rendered":"<table width=\"150\" border=\"0\" align=\"right\">\n<tr>\n<td><a href=\"https:\/\/itatonline.org\/archives\/?dl_id=68\" onclick=\"if (event.button==0) \r\n     setTimeout(function () { window.location = 'http:\/\/itatonline.org\/downloads.php?varname=dl_id=68&varname2=western_coalfield_penalty_deductibility_expl_37_1.pdf'; }, 100)\" ><strong>Click here to download the judgement (western_coalfield_penalty_deductibility_expl_37_1.pdf) <\/strong> <\/a><\/p><\/td>\n<\/tr>\n<\/table>\n<p><strong> Explanation to s. 37 (1) does not apply to &#8220;penalty&#8221; which is not of the nature of illegal \/ unlawful expenditure  <\/strong><\/p>\n<p>The assessee became liable to pay \u201c<strong>penalty<\/strong>\u201d for overloading wagons under the rules of the Railways. The question arose whether the said \u201cpenalty\u201d was disallowable under the <strong>Explanation to s. 37 (1)<\/strong> which provides that \u201c<em>expenditure incurred for any purpose which is an offence or which is prohibited by law<\/em>\u201d shall not be allowable. HELD, deciding in favour of the assessee:<\/p>\n<p>The substance of the matter had to be looked into and given preference over the form. <strong>Though the amount was termed \u201cpenalty\u201d, it was essentially of a commercial nature and incurred in the normal course of business and was consequently allowable<\/strong>. <\/p>\n<p>Note: The judgement also holds that <strong>provision for estimated increases<\/strong> in wages made during ongoing negotiations with workers pending finalization of an agreement is deductible expenditure.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The assessee became liable to pay \u201c<strong>penalty<\/strong>\u201d for overloading wagons under the rules of the Railways. The question arose whether the said \u201cpenalty\u201d was disallowable under the <strong>Explanation to s. 37 (1)<\/strong> which provides that \u201c<em>expenditure incurred for any purpose which is an offence or which is prohibited by law<\/em>\u201d shall not be allowable. HELD, deciding in favour of the assessee:<\/p>\n<p>&nbsp;<\/p>\n<p>The substance of the matter had to be looked into and given preference over the form. <strong>Though the amount was termed \u201cpenalty\u201d, it was essentially of a commercial nature and incurred in the normal course of business and was consequently allowable<\/strong>. <\/p>\n<div class=\"read-more\"><a href=\"https:\/\/itatonline.org\/archives\/western-coalfields-vs-acit-itat-mumbai\/\">Read more &#8250;<\/a><\/div>\n<p><!-- end of .read-more --><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[4,8],"tags":[],"class_list":["post-867","post","type-post","status-publish","format-standard","hentry","category-all-judgements","category-tribunal"],"acf":[],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/itatonline.org\/archives\/wp-json\/wp\/v2\/posts\/867","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/itatonline.org\/archives\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/itatonline.org\/archives\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/itatonline.org\/archives\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/itatonline.org\/archives\/wp-json\/wp\/v2\/comments?post=867"}],"version-history":[{"count":0,"href":"https:\/\/itatonline.org\/archives\/wp-json\/wp\/v2\/posts\/867\/revisions"}],"wp:attachment":[{"href":"https:\/\/itatonline.org\/archives\/wp-json\/wp\/v2\/media?parent=867"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/itatonline.org\/archives\/wp-json\/wp\/v2\/categories?post=867"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/itatonline.org\/archives\/wp-json\/wp\/v2\/tags?post=867"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}