Interest paid u/s 201(1A) on late payment of TDS is penal in nature

Living Liquidz SM Trades LLP Vs Assessing Officer (ITAT Mumbai) ITAT Mumbai held that disallowance of interest expenditure paid u/s. 201(1A) of the Income Tax Act on late payment of TDS is penal in nature and not compensatory. Facts- The assessee has challenged the assessment order passed u/s. 143(3) of the Act as invalid and bad in law and has also challenged the disallowance of operative expenses of Rs.15,29,595/- and interest paid on late payment of TDS amounting to Rs.12,980/-debited to profit and loss account. Conclusion- The lower authorities have not disputed the fact that there was no ...