https://www.taxtmi.com/caselaws?id=62300 A charge arising automatically on shortfall in maintaining statutory reserve ratios was treated as compensatory regulatory interest, not a penalty for infraction of law, so it was considered allowable as a deduction. The Tribunal distinguished this levy from a punitive disallowance because the rate-linked charge operated under the banking regulatory framework and was not converted into a penalty merely by the absence of a lender-creditor relationship. On the section 68 issue, the inability to identify every fixed-deposit holder did not, by itself, justify adding the deposits as income; absent proof that the deposits were undisclosed income of the bank, the addition was unsustainable. en-us Thu, 31 Aug 2000 00:00:00 +0530 Fri, 03 Mar 2017 12:53:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=62300 A charge arising automatically on shortfall in maintaining statutory reserve ratios was treated as compensatory regulatory interest, not a penalty for infraction of law, so it was considered allowable as a deduction. The Tribunal distinguished this levy from a punitive disallowance because the rate-linked charge operated under the banking regulatory framework and was not converted into a penalty merely by the absence of a lender-creditor relationship. On the section 68 issue, the inability to identify every fixed-deposit holder did not, by itself, justify adding the deposits as income; absent proof that the deposits were undisclosed income of the bank, the addition was unsustainable. Case-Laws Income Tax Thu, 31 Aug 2000 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=62300