https://www.taxtmi.com/caselaws?id=350307 VAT-related levies are deductible only to the extent they are compensatory in character; penalties for statutory defaults remain non-deductible under Explanation 1 to section 37, while compensatory interest for delayed tax payment may be allowed. On that basis, only the interest charged under section 30(1) of the Jharkhand VAT Act was treated as allowable, and the penalty components and other non-compensatory levies were disallowed. Interest earned on temporary deposits from funds inextricably linked to expansion was held to have a direct nexus with the project and was therefore netted off against pre-operative expenditure rather than assessed separately as income from other sources. en-us Tue, 31 Oct 2017 00:00:00 +0530 Fri, 03 Nov 2017 10:52:48 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=350307 VAT-related levies are deductible only to the extent they are compensatory in character; penalties for statutory defaults remain non-deductible under Explanation 1 to section 37, while compensatory interest for delayed tax payment may be allowed. On that basis, only the interest charged under section 30(1) of the Jharkhand VAT Act was treated as allowable, and the penalty components and other non-compensatory levies were disallowed. Interest earned on temporary deposits from funds inextricably linked to expansion was held to have a direct nexus with the project and was therefore netted off against pre-operative expenditure rather than assessed separately as income from other sources. Case-Laws Income Tax Tue, 31 Oct 2017 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=350307