TaxTMI 
TaxTMI 
2015 (4) TMI 583
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....on on account of disallowance of deduction claimed u/s. 36(1)(viia) of IT Act Rs. 4,44,52,560. 3. For the year under reference the assessee has filed the revised return of income on 31.03.2012, admitting an income of Rs. 43,09,08,818/- as against the income of Rs. 52,85,83,150/- admitted in original return of income filed on 09.10.2010. The revision was on account of omission to claim depreciation of Rs. 976,74,332/- on securities held as stock in trade. The AO rejected the revised return on the ground that there is no change in columns filled as per original and revised returns, except the columns for Profits and Gains from business other than speculative business and subsequent columns, in the case of assessee and a revised return can be filed only when any omission or wrong statement was discovered in original return. For this proposition the AO relied on the decision of Assam High Court in the case of Sunanda Rao Deka Vs. CIT (210 ITR 988), wherein it was held that filing of revised return after discovery of omission or wrong statement in original return is not by itself sufficient to bring revised return in the ambit of Sec. 139(5) of the Income Tax Act, but further require....
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....te to correct some bonafide omission or bonafide wrong statement which may have occurred so that correct total income is disclosed. It is inherent in the section that if while submitting a return any information is left out accidentally computing the income of the assessee, then to enable the assessee to communicate such information to the revenue, the facility or revised return is given. However, the omission or wrong statement must be discovered by the assessee himself and must be bonafide. During the course of assessment proceedings, assessee has submitted written statement dated 11.03.2013 informing the reasons for submission of revised return and the same was reproduced as under: "At the time of filing original return, we have inadvertently not claimed the "Depreciation/Loss on investment" which were considered as stock-intrade. In our earlier submission, we have given the detailed working on "Depreciation/loss on investment". Depreciation on securities held as stock in trade Rs. 976,74,332/- 7. While completing the assessment and computing the total income, the AO has not considered the claim of Rs. 976,74,332/-, towards depreciation on securities held as stock in tr....
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....e banks. It was also held that where there is no distinction between the categories of securities, the assessee can provide depreciation on securities". 10. The ld CIT (A) relied on the order of the ITAT Hyderabad in case of AP Grameen Vikas Bank (ITA No.610/Hyd/2013) dated 13.03.2014 and the CIT (A) held that disallowance of Rs. 9,76,74,332 made by the AO does survive and the ground was treated as allowed. Addition on account of disallowance of broken period interest on purchase of securities held as stock in trade Rs. 3,73,12,444/- 11. While computing the taxable income of the assessee, AO has disallowed the claim of Rs. 373,12,444/- made towards the broken period of interest in acquiring the securities, which are held as stock in trade by the assessee bank relying on the decision of Supreme Court in the case of Vijaya Bank Vs. ClT, reported in 187 ITR 541. 12. The assessee objected for such disallowance and submitted that the securities were held as stock in trade on the lines of State Bank of Hyderabad, which is the holding bank of the assessee bank, where the similar claim was upheld by the Hon'ble' ITAT, Hyderabad, dt. 18.03.2005. The assessee also relied ....
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....was created without any necessity as such the provision was unwarranted and the said claim towards bad and doubtful debts under 7.5% category is disallowed to be added back to the returned income and brought to tax. 16. The assessee's objection for such disallowance/addition was on the ground that the provisions of Sec. 36(1)(viia) permits banking company to claim a deduction not exceeding 7 .5% of total income computed, towards bad and doubtful debts. The assessee relied on the decision of ITAT, Hyderabad, in the case of SBH Vs. DCIT (ITA No. 1232/Hyd./2006) to support the claim of deduction @ 7.5% of the total income. The assessee also relied on the decision of Karnataka High Court, in the case of DCIT, SR Vs. Karnataka Bank Ltd., to support the argument that deductions u/s. 36(1)(vii) are allowable independently and irrespective of provisions for bad and doubtful debts, without claiming the deduction u/s 36(1)(vii) and 36(1)(viia) simultaneously. 17. The ld CIT (A) perused the submissions of the assessee and the observations of the AO. The CIT (A) held as follows: "As could be seen from the facts of the case brought on record, the assessee claimed a deduction of Rs. 4,4....