TaxTMI 
TaxTMI 
TaxTMI 
2016 (2) TMI 606
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.... in respect of the same respondent Uday assessee. Besides following the decision of the High Court in the case of CIT vs Bank of Baroda [262 ITR 334] which in turn has placed reliance upon the Apex Court decision in UCO Bank (Supra). In view of the issue being concluded, we were inclined not to entertain the question as formulated. (b) However, Mr.Malhotra, learned counsel appearing for the revenue, pointed out that the revenue's appeal from the order of the Tribunal for the Assessment Years 2005-06 and 2006-07 had been admitted. However, while admitting that appeal, the present question has not been considered as it does not state whether it admits or rejects the above questions. Thus it is submitted that this question is still open in the earlier appeals for Assessment Year 2005-06 and 2006-07 bearing Income Tax Appeal Nos. 152 of 2012 and 176 of 2012. Therefore this question could be considered at the final hearing of this appeal alongwith the two appeals bearing Income Tax Appeals Nos. 152 of 2012 and 176 of 2012. (c) We were not inclined to adjourn the consideration of this question for admission at the stage to final hearing. This is particularly so as it would have a....
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....for consideration. "(6) Whether on the facts and in the circumstances of case and in law, the Tribunal is right in allowing the claim of the assessee in respect of loss on revaluation of investments amounting to Rs. 359,93,42,619 ?" 3. The respondent assessee had for Assessment Year 200708 claimed a loss of Rs. 476 crores on revaluation of investment i.e. depreciation in the value of securities. The Assessing Officer by his order dated 30th December, 2009 under Section 143(3) of the Act disallowed the depreciation on investment on the ground that the respondent had claimed deduction differently in its books of account from that being claimed for the purposes of income tax. It was noted by the Assessing Officer that for the purposes of its books of accounts, the respondent has been netting off the depreciation in its securities against appreciation in other securities while for the purpose of payment of tax, the respondent assessee has been claiming gross depreciation that is without netting of the appreciation in other securities held as a part of investment. In the aforesaid circumstances, the Assessing Officer was of the view that the the netting basis for valuation as adopted....
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....decision of this Court in Bank of Baroda (Supra) which covers the issue in favour of the Respondent-Assessee. We have been informed that the Revenue's appeal for the Assessment Year 2005-06 and 2006-07 from the order of the Tribunal in respect of the same respondent assessee being Income Tax Appeal Nos. 152 of 2012 and 176 of 2012, were not entertained in respect of question no.6 raised herein inasmuch as no question in respect thereof was admitted. However, the Revenue wanted to urge this issue on the ground that this question was not considered by this Court while admitting the Income Tax Appeal No.152 of 2012 and 176 of 2012. 6. In support of the appeal, Mr. Malhotra, learned Counsel for the Revenue places reliance upon the CBDT Circular No.665 dated 5th October, 1993 and in particular para 4 thereof as reproduced hereinabove to contend that the valuation of investments in the nature of securities of the respondent assessee bank has to be necessarily done in terms of the RBI guidelines i.e. by netting of the appreciation in the securities with depreciation in other securities. In support, Mr. Malhtora, places reliance upon the Master Circular dated 1st July, 2011 as updated....
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....a true picture of the profits and gains, i.e. real income is to be disclosed. For determining the real income, the entries in the balance-sheet is required to be maintained in the statutory form may not be decisive or conclusive. It is open to the Income Tax Officer as well as the assessee to point out true and proper income while submitting the income tax returns. Even if the assessee under some misrepresentation or mistake fails to make an entry in the books of account, although under law, a deduction must be allowed by the Income Tax Officer, the assessee will not lose any right on claiming or will be debarred from being allowed the deduction. Therefore, the approach of the authorities in this regard is contrary to the well settled legal position as declared by the apex court. In the instant case, the assessee has maintained the accounts in terms of the RBI Regulations and he has shown it as investment. But consistently for more than two decades it has been shown as stock-in-trade and depreciation is claimed and allowed. Therefore, notwithstanding that in the balance-sheet, it is shown as investment, for the purpose of Income Tax Act, it is shown as stock-in-trade. Therefore, ....