Disallowed Expenses

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This discussion addresses the disallowance of TDS late fees, interest, and ROC fees related to capital increases under income tax law. It suggests Section 37(1) as a potential disallowance ground, referencing a Supreme Court decision. Guidance is also sought on how to report these disallowed expenses within the Tax Audit Report.

Jignesh Savaliya

Jignesh Savaliya (Querist)

20 October 2020 TDS late Fees and Interest and ROC Fees for Increase of Capital are disallowed under which section of income tax?
Also help me for reporting in Tax audit Report?

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)

20 October 2020 May be disallowed u/s 37(1) being wholly and exclusively spent for the purposes of business.
Supreme court decision in Bharat Commerce and Industries Ltd. Vs CIT (1985) may be referred to.

Jignesh Savaliya

Jignesh Savaliya (Querist)

20 October 2020 In Tax Audit Report which Clause??

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