Demand by service tax demand
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
02 February 2016
if any service tax demand ,penalty & interest demand by service tax department is allowable if allowable under which section
Demand
Penalty
interest
Demand
Penalty
interest
02 February 2016
From the query it is not clear whether you are asking about allowability under Finance Act 1994 (as amended) or the provisions of Income Tax Act 1961. I am presuming you are asking for the latter clarification. Service Tax being an indirect tax like VAT / CST is recovered from the customer and remitted to the Treasury. Therefore there is no question of allowability of the expense. However, if no money has been recovered from customers and a demand is made and PAID, the demand can be charged to P& L Account as allowable expenses. The same is the case with interest, since the interest is in the nature of cost for delayed deposit of tax - it is not penal interest. However one has to keep in mind that the interest only to the extent of 18% p.a. is allowable - since after 6 months the rate is 24% p.a. and after 12 months it is 30% p.a.. Penalty paid is not an allowable expense.
02 February 2016
1. service tax and interest is an allowable expenditure u/s. 37(1) of the Income tax Act,1961.
2. penalty is not an allowable expenditure as per the above said act.
2. penalty is not an allowable expenditure as per the above said act.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Opting our of sec 44AD
- INTEREST APPLICABLE ON ITC REVERSAL PORTION
- Form 121 & TDS deduction
- Transporter Declaration form
- LC charges in relation to Asset purchased should be Capitalised ?
- SALE OF MOTOR CAR BY REGISTERED INDIVIDUAL
- Regarding TDS Applicability For Director Remuneration
- Value of property in capital gain
- Regarding appeal to GSTAT
- Multiple trade mark
- GST Treatment of Insurance Commission for Existing GST Holder
- Cash gift by grand mother to her grand daughter
- Tax amount diff in Gstr1 and 3B in tax compare reports
- Tds on GST in connection with sale to public company
- Restoration of certificate of practice
- Regarding change in correspondence address in SSP portal
- No Compliences after incorporation
- USEFUL LIFE OF USED/SECOND HAND COMMERCIAL VEHICLES
- Claiming TDS deducted by builder on Hardship compensation and Corpus
- Address Change to another state of a Registered Trust with 12AB approval
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
CAclubindia
