SEBI Penalty for shortfall in margin money eligible for section 37 Deduction

DJS Stock and Shares Ltd. Vs DCIT (ITAT Mumbai)

In the instant case penalty charged levied by the SEBI are related to shortfall in the margin money and is not for infraction of any law. Accordingly the said payment cannot be considered as penalty for violation of any law falling within the ambit of proviso to section 37(1) of the Act. Accordingly, following the decision rendered by the Division Bench in the case of M/s. The Stock & Bond Trading Co. (supra), I hold that the said amount is allowable as deduction.

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