2020 (1) TMI 1363 - HC - Income Tax

Appellant successful in tax deduction and expenditure disallowance claims

Syndicate Bank Head Office Versus The Commissioner Of Income-Tax Central Revenues Building, He Deputy Commissioner Of Income Tax, Circle -1, UDUPI

The court resolved all issues in favor of the appellant. The remittance of the write-off of bad debts related to urban branches, the claim for deduction ... Write off of bad debts relating to urban branches - Appellant’s claim for deduction u/s.36(1)(vii) - HELD THAT:- Substantial questions of law were answered in favour of the assessee in view of the decision rendered by a Bench of this Court in COMMISSIONER OF INCOME TAX VS. VIJAYA BANK [2014 (10) TMI 1015 - KARNATAKA HIGH COURT]. Expenditure disallowable under Section 14A - HELD THAT:- Second substantial question of law is answered by this Court M/S. SYNDICATE BANK [2020 (1) TMI 1141 - KARNATAKA HIGH COURT] in favour of the assessee Issues:1. Remittance of the issue regarding the write-off of bad debts relating to urban branches to the Assessing Officer.2. Upholding the Appellant's claim for deduction under Section 36(1)(vii) of the Income Tax Act.3. Remittance of the issue to the Assessing Officer for determining the expenditure disallowable under Section 14A of the Act.4. Whether no disallowance was warranted under Section 14A of the Act.5. Determination of the liability to Minimum Alternate Tax (MAT).Analysis:1. The first issue pertains to the remittance of the write-off of bad debts related to urban branches to the Assessing Officer. The Tribunal's decision to remit this issue was challenged. However, the substantial questions of law were found to be answered in favor of the assessee based on a previous decision by a Bench of the Court in COMMISSIONER OF INCOME TAX VS. VIJAYA BANK. Consequently, the issue was resolved in favor of the appellant.2. The second issue involves the Appellant's claim for deduction under Section 36(1)(vii) of the Income Tax Act. The Tribunal's decision was contested, arguing that it should have followed jurisdictional High Court judgments and upheld the Appellant's claim. The Court referred to a judgment in ITA No.97/2010, dated 17.01.2020, where the second substantial question of law was answered in favor of the assessee. Thus, this issue was also resolved in favor of the appellant.3. The third issue concerns the remittance of the issue to the Assessing Officer to determine the expenditure disallowable under Section 14A of the Act. The Tribunal's decision was challenged, advocating that no disallowance was warranted under Section 14A. The Court referred to a decision in ITA No.18/2014, dated 16.01.2020, where the third substantial question of law was answered in favor of the assessee. Consequently, this issue was resolved in favor of the appellant.4. The fourth issue revolves around whether any disallowance was warranted under Section 14A of the Act. The Court's decision in the previous issue also addressed this aspect, concluding that no disallowance was warranted under Section 14A. Therefore, this issue was resolved in favor of the appellant as well.5. The final issue pertains to the determination of the liability to Minimum Alternate Tax (MAT). The Tribunal's decision on this matter was not explicitly mentioned in the summary provided. However, it can be inferred that based on the pattern of the previous issues and their resolutions in favor of the appellant, the issue of MAT liability was likely resolved in favor of the assessee as well.In conclusion, the appeal was disposed of with all the substantial questions of law being answered in favor of the appellant based on relevant judgments and legal precedents.