2013 (2) TMI 713

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..... assessment year 2007-08 against order dated 15.9.2011 of ld CIT(A) -II, Thane on following ground: The AO erred in disallowing the interest on late payment of MVAT Act, 2002 to the extent of ₹ 6,41,348/- which is compensatory in nature and rightly claimed u/s.37(1) of MVAT Act, 2002. 2. Facts in brief are that assessee is an individual carrying on business as a proprietor under the .....

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..... being new to the business, realization of funds from sundry creditors was late. Hence, assessee was not able to make VAT payments in time. AO did not accept the assessee's submission. He observed that assessee had to make this payment on account of his default in making payment of statutory dues in time. Therefore, the extra payments by way of interest made by the assessee cannot be said to b .....

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..... basis which is prescribed in the said Act. 5. The Hon'ble Supreme Court in the case of Mahalakshmi Sugar Mills Co. vs. CIT, 123 ITR 429(SC) have held that interest for delay payment of statutory dues is an allowable deduction u/s.37(1) of the Act. Same view has also been taken by Hon'ble Supreme Court in the case of Lachmandas Mathuradas vs CIT, 254 ITR 799(sc). We also find that Hon .....

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