Dismissing the appeal of the assessee, the Tribunal held that, interest paid under S. 201(1A) for delay in depositing tax deducted at source, is in nature of tax and same cannot be allowed as a deduction . Followed CIT v. Chennai Properties & Investment Ltd (1999) 239 ITR 435 ( Mad) (HC), Dy.CIT v. Narayani Ispact ( P) Ltd ( ITA No. 2127( Kol) of 2014 dt 30-8-2017 is not followed. (AY. 2012-13)
Velankani Information Systems Ltd. v. DCIT (2018) 173 ITD 19 /172 DTR 356/ 196 TTJ 1128(Bang.) (Trib.)
S. 37(1) : Business expenditure–Income -tax -Delay in payment of tax deduction at source- Interest paid under S. 201(1A) is in nature of tax and not allowable as business expenditure. [S. 2(43), 40(ii), 201(IA )]