Vessel Damage Payments, Capital in Nature and Not fall under Section 5(2): ITAT

DCIT Vs Nirma Limited (ITAT Ahmedabad) Introduction: The Income Tax Appellate Tribunal (ITAT) Ahmedabad recently upheld the decision in favor of Nirma Limited, dismissing the appeal filed by Revenue. The dispute centered around the nature of payments made by Nirma Limited for vessel damage, with the ITAT ruling that the payments were reimbursements and of a capital nature, not falling under Section 5(2) of the Income Tax Act. Background: The case, DCIT Vs Nirma Limited, was brought before the ITAT Ahmedabad following an order dated 10.04.2023 passed by the Ld. Commissioner of Income Tax (Appea...