Section 14A disallowance on bank stock-in-trade investments was rejected under settled precedent and consistency.

Section 14A read with Rule 8D disallowance was held unsustainable for a bank's investments held as stock-in-trade, as the issue was already covered by the assessee's own earlier year decision. The Tribunal applied the principle of consistency, noting no material change in facts or circumstances and following the coordinate bench's settled view. It accepted that the Revenue's approach could not displace binding precedent on this issue, and the deletion of the disallowance was upheld.

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Issues: Whether disallowance under section 14A read with Rule 8D was sustainable in respect of investments held as stock-in-trade by a bank, and whether the earlier view in the assessee's own case and the principle of consistency justified deletion of the disallowance.

Analysis: The appeals involved identical facts and the same issue as in the earlier year. The Tribunal noted that the coordinate bench had already upheld deletion of the disallowance in the assessee's own case, and that there was no material change in facts or circumstances to warrant a different view. The Tribunal also accepted the CIT(A)'s reliance on binding precedent and the settled approach that investments held as stock-in-trade in the case of banks do not attract disallowance under section 14A in the manner sought by the Revenue. On that basis, the principle of consistency was applied.

Conclusion: The disallowance under section 14A was not sustainable, and the Revenue's appeals were dismissed.

Final Conclusion: The assessee succeeded on the sole substantive issue, and both Revenue appeals failed.

Ratio Decidendi: In the absence of any material change in facts, a coordinate bench's earlier decision in the assessee's own case should be followed, and section 14A disallowance cannot be sustained where the issue is covered by settled precedent on bank investments held as stock-in-trade.

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