Disallowance of Income Tax deduction on Business Expenditure for Payment of Penalty to Clients/Customers for Breach of Contract: ITAT Remands Ex-parte Order to AO for Re-adjudication

Disallowance of Income Tax deduction - Business Expenditure - Payment of Penalty to Clients - Customers - Breach of Contract - ITAT Remands Ex-parte Order to AO - Re-adjudication - taxscan

The Bangalore Bench of Income Tax Appellate Tribunal (ITAT) remanded the ex-parte order to the files of Assessing Officer for re-adjudication in regards to the disallowance of deduction on business expenses for the payment of penalties to clients or customers for contract violations. The assessee in this case is Bandi Hemasunder Reddy, during the assessment…

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