Interest U/s 36/2 of VAT Act is levied against which and appeal is pending before the commission whether such interest is to be treated as Tax for the purpose of disallowed U/s 43 B of Income Tax Act.If the same is treated as interest then will not be any dis-allowance.
23 June 2013
Since the interest demand is pending in appeal, until the appeal is decided, it does not become the liability of the assessee. . However, if the interest liability has been recorded in the books on the basis of the AO's order, it is a kind of tax being known as "whatever" name. For the purpose of Section 43B it should be disallowed. . Logically, also the above treatment stands in favour of the assessee. .
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