https://www.taxtmi.com/caselaws?id=463049 The ITAT Chennai allowed the deduction of ex-gratia payments to employees, following the Mad HC decision in City Union Bank Ltd., rejecting the revenue's claim that it was mere profit appropriation. Interest accrued on non-performing assets was also allowed, consistent with prior Tribunal rulings. The deduction under section 36(1)(viia) for provisions on rural advances was upheld based on average aggregate advances per City Union Bank Ltd. The AO was directed to classify rural branches using provisional census data as of the financial year's start, denying rural status if population exceeded 10,000. Deduction under section 36(1)(viii) was allowed on infrastructure, agricultural, and housing loans, maintaining consistency with prior years. Depreciation on investments, including HTM securities, was remanded for fresh examination by the AO per RBI norms, as earlier authorities had not properly considered appreciation and depreciation separately. en-us Fri, 19 Aug 2022 00:00:00 +0530 Sat, 02 Aug 2025 16:00:18 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=463049 The ITAT Chennai allowed the deduction of ex-gratia payments to employees, following the Mad HC decision in City Union Bank Ltd., rejecting the revenue's claim that it was mere profit appropriation. Interest accrued on non-performing assets was also allowed, consistent with prior Tribunal rulings. The deduction under section 36(1)(viia) for provisions on rural advances was upheld based on average aggregate advances per City Union Bank Ltd. The AO was directed to classify rural branches using provisional census data as of the financial year's start, denying rural status if population exceeded 10,000. Deduction under section 36(1)(viii) was allowed on infrastructure, agricultural, and housing loans, maintaining consistency with prior years. Depreciation on investments, including HTM securities, was remanded for fresh examination by the AO per RBI norms, as earlier authorities had not properly considered appreciation and depreciation separately. Case-Laws Income Tax Fri, 19 Aug 2022 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=463049