https://www.taxtmi.com/caselaws?id=19735 Interest charged for delayed payment of electricity charges was treated as compensatory, not penal, because the liability arose automatically under the supply agreement or applicable regulations on default in payment. The existence of a separate penalty provision for disconnection did not alter the character of the levy, and the label used for the charge was not decisive. On that basis, the amount was regarded as an allowable deduction under section 37(1) of the Income-tax Act, 1961, in favour of the assessee. en-us Thu, 06 Oct 1994 00:00:00 +0530 Mon, 09 Nov 2009 13:17:55 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=19735 Interest charged for delayed payment of electricity charges was treated as compensatory, not penal, because the liability arose automatically under the supply agreement or applicable regulations on default in payment. The existence of a separate penalty provision for disconnection did not alter the character of the levy, and the label used for the charge was not decisive. On that basis, the amount was regarded as an allowable deduction under section 37(1) of the Income-tax Act, 1961, in favour of the assessee. Case-Laws Income Tax Thu, 06 Oct 1994 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=19735