Indian tribunal rules on certain crucial aspects of tax penalties

The Income Tax Appellate Tribunal (ITAT) has in a recent ruling confirmed the levy of penalty on the offset of tax-exempt capital losses against taxable income in a finding that the claim of the taxpayer was not sustainable in law. In doing so, the ITAT has highlighted some crucial aspects of law concerning levy of tax penalties, explain Sanjay Sanghvi & Ashish Mehta of Khaitan & Co.