Case Law Details
Ogene Systems India Limited Vs ITO (ITAT Hyderabad)
Impugned encashment of bank guarantee is outcome of failure to perform its contractual obligation only without involving any offence or penal component u/s.37(1) of the Act. we find that a catena of case law holds that such an encashment of bank guarantee is incurred in the normal course of business than involving any penalty element at all. We adopt the very reasoning herein as well and direct the Assessing Officer to delete the impugned disallowance/addition in issue.
FULL TEXT OF THE ORDER OF ITAT HYDERABAD
This assessee’s appeal for AY.2014-15 arises from the CIT(A)-4, Hyderabad’s order dated 21-12-2017 passed in case No.0395 / 16-17 / ITO,Wd.16(4) / CIT(A)-4, Hyd / 17-18, in proceedings u/s. 143(3) of the Income Tax Act, 1961 [in short, ‘the Act’].
Heard both the parties. Case file perused.
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