Assessee's appeal partly allowed, Revenue's cross-appeal dismissed, reassessment ordered for consistent examination.

The tribunal partly allowed the assessee's appeal, dismissing the Revenue's cross-appeal. The Assessing Officer was directed to re-adjudicate certain issues based on previous tribunal and CIT(A) findings to ensure a consistent examination of facts and applicable law.

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Issues Involved:
1. Disallowance under Section 36(1)(viia) of the Income Tax Act.
2. Disallowance of prior period expenses.
3. Disallowance of interest paid for delayed remittance of TDS.
4. Disallowance of education cess & secondary and higher education cess.
5. Applicability of Section 115JB (Minimum Alternate Tax) to the appellant bank.
6. Allowability of loss on valuation of Held to Maturity (HTM) securities.

Issue-wise Detailed Analysis:

1. Disallowance under Section 36(1)(viia):
The assessee challenged the CIT(A)'s decision to restrict the claim under Section 36(1)(viia) to Rs. 143,07,19,755/- against the claimed Rs. 1083,06,95,013/-. The CIT(A) held that the deduction should be restricted to the provision made in the books for rural advances. The tribunal noted that this issue is recurring and referred to its previous decision for AY 2010-11, which restored the matter to the assessing authority for reconsideration. The tribunal accepted the assessee's grievance for statistical purposes, directing the Assessing Officer to frame a consequential adjudication.

2. Disallowance of Prior Period Expenses:
The assessee contested the disallowance of prior period expenses amounting to Rs. 1,72,73,670/-, arguing that these expenses crystallized during the relevant previous year. The tribunal found no force in the Revenue's arguments and allowed the assessee's claim in principle. The tribunal directed the Assessing Officer to examine the supportive evidence of crystallization of the expenses in the relevant year, referencing CIT Vs. Indian Petrochemicals Corporation Ltd. and CIT vs. Adani Enterprises Ltd.

3. Disallowance of Interest Paid for Delayed Remittance of TDS:
The tribunal addressed the disallowance of Rs. 1,71,338/- paid as interest for delayed TDS remittance, which the Revenue considered penal in nature. The tribunal found no merit in the Revenue's arguments, referencing Lachmandas Mathuradas vs. CIT, DCIT vs. Rungta Mines Ltd., and M/s. M.L. Reality vs. ACIT, which held that such interest payments are allowable under Section 37 of the Act. The disallowance was deleted.

4. Disallowance of Education Cess & Secondary and Higher Education Cess:
The assessee's claim for education cess and secondary and higher education cess totaling Rs. 8,69,48,904/- was disallowed based on the amendment to Section 40(h) of the Act by the Finance Act 2022, effective from 01.04.2005. The tribunal noted that the claim is not allowable in law and rejected the same.

5. Applicability of Section 115JB (Minimum Alternate Tax):
The assessee contended that Section 115JB is not applicable to it as a public sector banking company. The tribunal referred to its previous decision for AYs 2013-14 and 2014-15, where the matter was remanded to the CIT(A) for a detailed examination of whether the assessee is a banking company or corporation. The tribunal restored the matter to the Assessing Officer for fresh adjudication in light of the CIT(A)'s findings in the preceding years.

6. Allowability of Loss on Valuation of HTM Securities:
The Revenue challenged the CIT(A)'s decision to allow the assessee's claim of loss on valuation of HTM securities amounting to Rs. 20,64,08,969/-. The tribunal noted that this issue had been settled in favor of the assessee in previous years by the tribunal and upheld by the Hon'ble Bombay High Court. The tribunal found no distinction in facts or law and upheld the CIT(A)'s findings, dismissing the Revenue's appeal.

Conclusion:
The assessee's appeal was partly allowed, and the Revenue's cross appeal was dismissed. The tribunal directed the Assessing Officer to re-adjudicate certain issues based on previous tribunal and CIT(A) findings, ensuring a consistent and thorough examination of the facts and applicable law.

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