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Amrutha.R.P (Article assistant)     16 September 2011

Please share your knowledge with regard to this?????

Hi friends,

My query is that when a Co-operative bank pays a penalty levied by RBI ... Such a penalty paid by the co-operative bank is an admissible or inadmissible expense....... Waiting for your answers....



 12 Replies

Deepak Tapse

Deepak Tapse (Accounts Manager - Taxation)     16 September 2011

I think it is inadmissible expenses, let's see others view also

CS RAJESH C.CHOUDHARY

CS RAJESH C.CHOUDHARY (ASSISTANT MANAGER)     16 September 2011

penalties are not allowed as deduction 

Vijay

Vijay (Adamo Studio)     16 September 2011

Not admissible

Nitin Singhal

Nitin Singhal (Gaining knowledge...)     16 September 2011

Penalties are of two types : 1) Penalty for breach of Law     2) penalty for not fulfilling contractual obligations

 

Type 1 penalties are not admissible under Income Tax Act, since they have been imposed for breach of a Law while Type 2 penalties are allowed under Income Tax.

 

Since in this case RBI has imposed penalty on another bank, it appears that it is in nature of Penalty for breach of law hence it is not admissible

4 Like
CA Shammi  Prabhakar

CA Shammi Prabhakar (Managing Director)     16 September 2011

NO.. not admissible..

CA Sumiit B Nagpal

CA Sumiit B Nagpal (Business)     17 September 2011

Originally posted by : Nitin Singhal

Penalties are of two types : 1) Penalty for breach of Law     2) penalty for not fulfilling contractual obligations

 

Type 1 penalties are not admissible under Income Tax Act, since they have been imposed for breach of a Law while Type 2 penalties are allowed under Income Tax.

 

Since in this case RBI has imposed penalty on another bank, it appears that it is in nature of Penalty for breach of law hence it is not admissible

AGREED

CA SHAH DILEEPKUMAR

CA SHAH DILEEPKUMAR (PARTNER)     17 September 2011

Inadmissible pl don't get confused
vipul jain

vipul jain (EFFORTS NEVER FAIL)     17 September 2011

Originally posted by : Nitin Singhal

Penalties are of two types : 1) Penalty for breach of Law     2) penalty for not fulfilling contractual obligations

 

Type 1 penalties are not admissible under Income Tax Act, since they have been imposed for breach of a Law while Type 2 penalties are allowed under Income Tax.

 

Since in this case RBI has imposed penalty on another bank, it appears that it is in nature of Penalty for breach of law hence it is not admissible

 

Ravindra kumar

Ravindra kumar (student)     17 September 2011

Originally posted by : Nitin Singhal

Penalties are of two types : 1) Penalty for breach of Law     2) penalty for not fulfilling contractual obligations

 

Type 1 penalties are not admissible under Income Tax Act, since they have been imposed for breach of a Law while Type 2 penalties are allowed under Income Tax.

 

Since in this case RBI has imposed penalty on another bank, it appears that it is in nature of Penalty for breach of law hence it is not admissible
PRADEEP REDDY

PRADEEP REDDY (CHARTERED ACCOUNTANT)     17 September 2011

any expense which is  made for breach of any law is not allowed as deduction under I.T act

Mayank

Mayank (Sr.Accountant)     18 September 2011

it is not admisible expense because any kid of penalties are not allowable in income tax.

CA AYUSH AGRAWAL

CA AYUSH AGRAWAL (Kolkata-Pune-Mumbai)     18 September 2011

 

Penalties are of two types : 1) Penalty for breach of Law     2) penalty for not fulfilling contractual obligations

 

Type 1 penalties are not admissible under Income Tax Act, since they have been imposed for breach of a Law while Type 2 penalties are allowed under Income Tax.

 

Since in this case RBI has imposed penalty on another bank, it appears that it is in nature of Penalty for breach of law hence it is not admissible


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