2018 (12) TMI 1769

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....r short 'I.T. Act'). The income under Section-115JA of the I.T. Act was shownas Rs. 24,35,14,910/-. The assessee claimed a sum of Rs. 15 Crores as provision for 'Non-performing Assets' covered under the policy with Deposit Insurance and Credit Guarantee Corporation. The Assessing Officer re-computed the income under Section-115JA and added back the saidamount of Rs. 15 crores. On an appeal being filed before the Commissioner of Income Tax (Appeals), the appeal was dismissed. The same was challenged before the Tribunal. The Tribunal by following the earlier order in the assessee's own previous case, directed the Assessing Officer to allow the provision as deduction, in computing the book profit under Section 115JA of the Act. Aggrieved by th....

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....x Court in the case of VIJAYA BANK Vs. COMMISSIONER OF INCOME TAX reported in [2010] 323 ITR 166 was considered, wherein the Apex Court considered the Explanation with regard to Item(c) of the Explanation of Section 115JA of the Act. It was held that a mere debit to the profit and loss account would constitute a bad and doubtful debt, but it would not constitute actual write off and that was the very reason why the explanation stood inserted. That prior to the Finance Act, 2001, the assessee would take the benefit of a deduction under Section 36(1)(vii) of the Act by merely debiting the impugned bad debt to the profit and loss account and, therefore, the explanation was added on to state that a mere reduction of profits by debiting the amou....