Penalty & fines paid other than I.T.Dept.
This query is : Resolved
29 April 2009
Dear Sir,
Can I claim penalty & fines paid to the Govt.Authorities other than I.T.Dept as an expenses if yes upto what extent and also we had paid huge amount of penalty on behalf of our customer which will be reimbursed by oure customer later on pls tell me the accounting entries for the same.
Can I claim penalty & fines paid to the Govt.Authorities other than I.T.Dept as an expenses if yes upto what extent and also we had paid huge amount of penalty on behalf of our customer which will be reimbursed by oure customer later on pls tell me the accounting entries for the same.
Ram Avtar Singh
(Expert)
29 April 2009
panality not allowed which is paid to Govt. or any other Authority.
Only compensation allowed.
as your penality will reimbursment by your customer. then debit to customers.
Only compensation allowed.
as your penality will reimbursment by your customer. then debit to customers.
Late CA Sampat Jain
(Expert)
29 April 2009
Any expenditure incurred for infraction of law is not allowable under the income tax act
29 April 2009
Penalty is for contravention of the provisions of law and,the levy is not compensatory,therefore not deductible as a business expenditure.
Citation:- Swadeshi Cotton Mills ltd 233 ITR 199(SC).
Citation:- Swadeshi Cotton Mills ltd 233 ITR 199(SC).
Manmohan ACA, CS
(Expert)
30 April 2009
not allowed
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