https://www.taxtmi.com/caselaws?id=445967 ITAT Ahmedabad dismissed revenue's appeal regarding compensation paid for breach of contract. The assessee paid damages to NHAL for failing to meet contractual deadlines. AO disallowed the deduction treating it as contravention of law and prior period expense. ITAT held that breach of contract damages cannot be equated with legal offences, citing Gujarat HC precedent in PCIT vs. Mazda Ltd. The damages crystallized in the assessment year, not being prior period expenses. ITAT also dismissed revenue's appeal on section 80-IA(7) disallowance since no deduction was claimed by assessee. en-us Tue, 31 Oct 2023 00:00:00 +0530 Thu, 23 Nov 2023 07:03:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=445967 ITAT Ahmedabad dismissed revenue's appeal regarding compensation paid for breach of contract. The assessee paid damages to NHAL for failing to meet contractual deadlines. AO disallowed the deduction treating it as contravention of law and prior period expense. ITAT held that breach of contract damages cannot be equated with legal offences, citing Gujarat HC precedent in PCIT vs. Mazda Ltd. The damages crystallized in the assessment year, not being prior period expenses. ITAT also dismissed revenue's appeal on section 80-IA(7) disallowance since no deduction was claimed by assessee. Case-Laws Income Tax Tue, 31 Oct 2023 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=445967