TaxTMI 
TaxTMI 
2013 (4) TMI 769
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....facts and in the circumstances of the case, the Ld. CIT(A)-II, Nashik was justified in deleting the addition of Rs. 17,91,659/- made on account of claiming expenditure towards amortization of investment held till maturity. 2. Whether on the facts and in the circumstances of the case, the Ld. CIT(A)-II, Nashik was justified in confirming the amount of amortization as revenue expenditure. 3. The appellant prays the order of the Assessing Officer may be restored. 4. The appellant prays to adduce such further evidence to substantiate his case. 5. The appellant prays leave to add, alter, clarify, amend and or withdraw any grounds of appeal as and when the occasion demands". 2. Brief facts of the case are that the....
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....d income. 3. Matter was carried before the first appellate authority who after considering various contentions raised on behalf of assessee allowed the claim of the assessee. Same has been opposed on behalf of revenue inter alia submitted that CIT(A) was not justified in deleting the addition of Rs. 17,91,695/- made on account of claiming expenditure towards amortization of investment held till maturity and requested to set aside the order of CIT(A) on this issue and restore that of Assessing Officer. On the other hand learned AR supported the order of CIT(A). 4. After going through rival submissions and material on record we find that with the advent of section 80P(4) w.e.f. A.Y. 2007-08 has closed the doors for cooperative....
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....l be included in the definition of 'income' (with effect from 1st April, 2007)". 6. Cooperative bank unlike other commercial banks are subjected to dual control from both RBI as well as from state cooperative department. The accounting treatment for a cooperative bank is therefore a result of guidelines from both the controlling authorities. Ordinarily a deduction is not available to an assessee unless specifically provided under the Act. This is irrespective of accounting treatment provided by the assessee in its books of accounts. But at the same time it was well settled that deduction expressly mentioned under the Act are not exhaustive and profit is to be derived according to ordinary commercial principles. As per the extant RBI....
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....uidelines dated 16th October, 2000, the investment portfolio of the banks is required to be classified under three categories viz. Held to Maturity (HTM), Held for Trading (HFT) and Available for Sale (AFS). Investments classified under HTM category need not be marked to market and are carried at acquisition cost unless these are more than the face value, in which case the premium should be amortised over the period remaining to maturity. In the case of HFT and AFS securities forming stock in trade of the bank, the depreciation/appreciation is to be aggregated scrip wise and only net depreciation, if any, is required to be provided for in the accounts. The latest guidelines of the RBI may be referred to for allowing any such claims." ....