https://www.taxtmi.com/caselaws?id=153164 Penalties imposed under sections 8(2) and 17(3) of the Madhya Pradesh General Sales Tax Act, 1958 were held not to be deductible under section 37(1) of the Income-tax Act, 1961. Expenditure qualifies only if it is laid out wholly and exclusively for business and is not capital or personal in nature; a payment imposed as a penalty for breach of law is different from a tax or statutory liability that accrues automatically. The court treated the payments as penalties arising from penal action for statutory non-compliance, not as commercial losses incurred in the course of business, and held that the assessee had not proved entitlement to deduction. en-us Fri, 13 Feb 1981 00:00:00 +0530 Thu, 18 Jul 2013 17:46:40 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=153164 Penalties imposed under sections 8(2) and 17(3) of the Madhya Pradesh General Sales Tax Act, 1958 were held not to be deductible under section 37(1) of the Income-tax Act, 1961. Expenditure qualifies only if it is laid out wholly and exclusively for business and is not capital or personal in nature; a payment imposed as a penalty for breach of law is different from a tax or statutory liability that accrues automatically. The court treated the payments as penalties arising from penal action for statutory non-compliance, not as commercial losses incurred in the course of business, and held that the assessee had not proved entitlement to deduction. Case-Laws VAT and Sales Tax Fri, 13 Feb 1981 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=153164