interest liability

The Central Excise law prescribes a time and procedure to pay the duty. When some amount is paid not as per that procedure or at time different from the time of payment of duty, such payment cannot be treated as duty paid under Central Excise. The issue was decided by the Gujrat High Court in Parle International Ltd. V/s VOI [2001 (127) ELT 329 (Guj.)], wherein the Hon’ble Court held that, Full Article

By issuance of shares the assessee cannot be said to have incurred any expenditure and hence, issuance of shares in lieu of interest liability cannot be considered to have been payment towards expenditure. Full Article

We do not find any error in the approach of the authorities below. Merely because the interest was debited in the books of accounts maintained on mercantile basis would not mean that the interest had become due and accrued because admittedly the interest liability would become due not during the relevant previous year but only for the first time on 18.11.1996. Full Article

SUMMARY OF CASE LAW After the amendment to the provisions in the statute by Direct Tax Laws (Amendment) Act, 1987 with effect from 1-4-1987 interest payable under section 234A, B and C are mandatory in nature and no discretion is vested in the Assessing Officer in this regard. Full Article

CASE DETAILS Decided by ITAT, PUNE BENCH ‘B’, PUNE, In the Case of L T John Deere P. Ltd. v. ACIT, Appeal No. : ITA Nos. 1347 to 1351/PN/2007 Dated: March 28, 2008 SUMMARY Where the assessee has given a bona fide explanation for its failure to deduct tax at source, the assessee should not [...] Full Article