Interest on Duty Drawback Refund Not a Penalty

Mahalasa Exports Vs ITO (ITAT Bangalore) ITAT Bangalore held that interest paid towards refund of excess claim of duty drawback is not in the nature of penalty or fine. Accordingly, provisions of Explanation 1 to section 37(1) of the I.T. Act not violated. Facts- The AO observed from the computation of duty drawback & service tax, the assessee refunded in the relevant year Rs.38,95,350 being excess duty drawback claimed @ 1% instead 0.15%. Resultantly the assessee paid interest of Rs .3,30,674 on the excess amount of refund claimed. The AO noted that interest against duty drawback received...