Deductability of Interest paid under section 234B
This query is : Resolved
V.Jagadeesan
(Querist)
17 March 2009
Dear All,
An assessee has paid interest u/s 234B in the year 2007-08 for the short fall short payment of advance tax for the year 2006-07.
Whether the interest paid is allowable as deduction in the computation of taxable income for the year 2007-08.
Regards,
V. Jagadeesan.
An assessee has paid interest u/s 234B in the year 2007-08 for the short fall short payment of advance tax for the year 2006-07.
Whether the interest paid is allowable as deduction in the computation of taxable income for the year 2007-08.
Regards,
V. Jagadeesan.
Rajesh Kumar
(Expert)
17 March 2009
Yes
17 March 2009
Interest payment on account of delayed remittance of advance income tax is not an allowable expenditure while computing taxable income of the ensuing year. Citation:-Bharat Commerce & Industries Ltd 98 Taxmann 151 (SC).
HUZAIFA HUSSAIN
(Expert)
18 March 2009
I AGREE WITH MR.B.CHACKRAPANI, BECAUSE THE INTEREST U/S 234B IS IN THE NATURE OF PENALTY FOR SHORT PAYMENT OF ADVANCE TAX.
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