https://www.taxtmi.com/caselaws?id=32056 Penal interest charged by a bank on delayed instalments in recurring deposit accounts is not chargeable to tax under the Interest Tax Act, 1974. The statutory definition of "interest" is confined to interest on loans and advances made in India, and the delayed instalment obligation in a recurring deposit does not constitute a loan or advance from the bank to the depositor. On that basis, penal interest arising from late payment falls outside the chargeable field under the Act and is not exigible to tax. en-us Thu, 28 Aug 2008 00:00:00 +0530 Wed, 23 Jan 2013 15:14:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=32056 Penal interest charged by a bank on delayed instalments in recurring deposit accounts is not chargeable to tax under the Interest Tax Act, 1974. The statutory definition of "interest" is confined to interest on loans and advances made in India, and the delayed instalment obligation in a recurring deposit does not constitute a loan or advance from the bank to the depositor. On that basis, penal interest arising from late payment falls outside the chargeable field under the Act and is not exigible to tax. Case-Laws Income Tax Thu, 28 Aug 2008 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=32056