https://www.taxtmi.com/caselaws?id=234956 The High Court upheld the Tribunal's decision allowing the deduction under section 37(1) of the Income-tax Act for the penalty paid to the Apparel Export Promotion Council. The court found the forfeiture of the bank guarantee to be compensatory in nature, stemming from the respondent's business decision due to incurring losses. The Revenue's argument that the encashment should be considered penal was rejected, affirming that the expense was a genuine business expenditure. Consequently, the appeal by the Revenue was dismissed, with no order as to costs. en-us Thu, 07 Mar 2013 00:00:00 +0530 Sat, 02 Apr 2016 10:27:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=234956 The High Court upheld the Tribunal's decision allowing the deduction under section 37(1) of the Income-tax Act for the penalty paid to the Apparel Export Promotion Council. The court found the forfeiture of the bank guarantee to be compensatory in nature, stemming from the respondent's business decision due to incurring losses. The Revenue's argument that the encashment should be considered penal was rejected, affirming that the expense was a genuine business expenditure. Consequently, the appeal by the Revenue was dismissed, with no order as to costs. Case-Laws Income Tax Thu, 07 Mar 2013 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=234956