https://www.taxtmi.com/caselaws?id=776431 ITAT Bangalore upheld that recoveries of bad debts are taxable under section 41(1) only if prior deduction under section 36(1)(vii) was allowed, directing AO to verify the nature of prior deductions. Deduction under section 36(1)(viia) for rural advances was allowed following ITAT Mumbai precedent. Disallowance of excess depreciation on ATMs and UPS was set aside, permitting depreciation at higher rates as per HC rulings. Provisions for Leave Fare Concession, resettlement expenses, and silver jubilee awards were allowed under section 37(1) based on prior tribunal decisions. Deduction under section 36(1)(viii) was upheld despite absence of separate books, relying on consistency and lack of contrary evidence. Provision for loss under Debt Relief Scheme was allowed under section 36(1)(viia). Disallowance under section 40(a)(ia) was deleted due to adequate compliance. Addition under section 69C was rejected as clerical error. Provision for Janatha Deposit Collector Gratuity was allowed under section 37(1). Relief on section 14A addition was confirmed, affirming no proximate nexus with exempt income. en-us Tue, 05 Aug 2025 00:00:00 +0530 Mon, 11 Aug 2025 08:43:24 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=776431 ITAT Bangalore upheld that recoveries of bad debts are taxable under section 41(1) only if prior deduction under section 36(1)(vii) was allowed, directing AO to verify the nature of prior deductions. Deduction under section 36(1)(viia) for rural advances was allowed following ITAT Mumbai precedent. Disallowance of excess depreciation on ATMs and UPS was set aside, permitting depreciation at higher rates as per HC rulings. Provisions for Leave Fare Concession, resettlement expenses, and silver jubilee awards were allowed under section 37(1) based on prior tribunal decisions. Deduction under section 36(1)(viii) was upheld despite absence of separate books, relying on consistency and lack of contrary evidence. Provision for loss under Debt Relief Scheme was allowed under section 36(1)(viia). Disallowance under section 40(a)(ia) was deleted due to adequate compliance. Addition under section 69C was rejected as clerical error. Provision for Janatha Deposit Collector Gratuity was allowed under section 37(1). Relief on section 14A addition was confirmed, affirming no proximate nexus with exempt income. Case-Laws Income Tax Tue, 05 Aug 2025 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=776431