TaxTMI 
TaxTMI 
2020 (3) TMI 213
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....r assessment years under consideration stands squarely covered by orders of this Tribunal in assessee's own case, for assessment year 2009 - 10 and 2010 - 11, vide order dated 25/04/2018 in ITA No. 673-674/be/2014 and for assessment year 2012 - 13 and 2013 - 14 reported in (2020) 113 Taxmann.com 530. Ld.AR further submitted that, identical issue was considered by this Tribunal has been upheld by Hon'ble Karnataka High Court, Dharwad Bench, vide order dated 14/12/2015, in ITA No. 13/2014 and ITA No. 14/2014, for assessment year 2007-08 and 2008-09. In the appeal filed by revenue issue raised are as under: 1. The order of CIT(A) is opposed to law and facts of the case. 2. Whether on facts & circumstances of the case, is the learned CIT(A) correct in allowing deduction of Rs. 225.73 crores u/s. 36(1) (viia). 3. Whether on facts & circumstances of the case, is the learned CIT(A) right in allowing assessee's claim of depreciation of Rs. 95.10 lakhs on investments. 4. Whether on facts & circumstances of the case, is the learned CIT(A) correct in deleting the addition of Rs. 13.76 lakhs made on account of stable drafts. 5. Any other ground that may be during the appeal. 6. Th....
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....n the books of account of the bank on the last day of the previous year." 9. In the case of Syndicate Bank (supra) 78 ITD 103 (Bang.), the Bangalore Bench of ITAT took the view that irrespective of the debit to the profit and loss account on account of provision for bad and doubtful debts (PBDD), an Assessee is entitled to 10 percent of the AARA as deduction u/s.36(1)(viia) of the Act. The relevant observations of the Tribunal in the aforesaid decision was as follows: "20. The learned CIT has also acted under the misconception that deduction under cl. (viia) is related to the actual amount of provision made by the assessee for bad and doubtful debts. The true meaning of the clause, as indicated earlier, is that once a provision for bad and doubtful debts is made by a scheduled bank having rural branches, the assessee is entitled to a deduction which is quantified not with respect to the amount provided for in the accounts, but with respect to a certain percentage of the total income and also a certain percentage of the aggregate average advances made by the rural branches of the bank. In other words, this is a specific deduction given by the statute irrespective of the quantum ....
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....ith claim of depreciation of Rs. 95.19 Lacs on investments held to maturity as stock in trade. 6. It has been submitted that, this issue also stands squarely covered by order of this Tribunal in ITA No. 673 and 674/be/2014 for assessment year 2009-10 and 2010-11 wherein this Tribunal observed as under: Ground No. 3 : As far as ground Nos. 4 and 5 raised by the Revenue are concerned, it is not in dispute before us that an identical issue came for consideration in Assessee's own case in assessment year 2008-09 and this Tribunal on identical issue held that the assessee is entitled to get deduction on account of depreciation of investments which were held in the category of HTM (Held to Maturity). The dispute in AY 2008-09 was the Assessee in its profit and loss. account for the year ended 31.3.2007 had written off a sum of Rs,17,59,00,087 claiming depreciation on investments, by way of loss on valuation of securities which represents depreciation in the value of securities held by the assessee as on 31.3.2007. The assessee had valued the securities held by it as on 31.3.2007 and found that the market value of such securities as on the said data was less than the cost of the securi....
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....ses, the assessee has maintained the accounts in terms of the RBI Regulations and h has shown it as investment. But consistently for more than 1tqdçades it has been shown as stock-in-trade and depreciation is claimed and allowed Therefore notwithstanding that in the balance feet it is shown as investment, for the purpose of Income Tax Act, it is shown as stock-in-trad. Therefore, the value of the stocks being closely connected with the stock market, at the end of the financial year, while valuing the assets, necessarily the Bank has to take into consideration the market value, of the shares. If the market value is less than the cost price, in law they are entitled to deductions and it cannot be denied by the authorities under the pretext that it is shown as investment in the Balance Sheet. 10. In that view of the matter, the order passed by the authorities balding that in view of the RBI guidelines, the assessee is stopped from treating the investment as stock-in-trade is not correct That finding recorded by the authorities is hereby set aside. Tie appeal is allowed............ 11.6 The facts of the case on hand are similar to those in the case of Karnataka Bank Ltd in I....
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....) of the Act. Section 41(1) reads as follows:- "41(1) where an allowance or deduction has been made in the assessment for any year in respect of loss, expenditure or trading liability incurred by the assessee (hereinafter referred to as the first-mentioned person) and subsequently during any previous year, - (a) the first-mentioned person has obtained, whether in cash or in any other manner whatsoever, any amount in respect of such loss or expenditure or some benefit in respect of such trading liability by way of remission or cessation thereof, the amount obtained by such person or the value of benefit accruing to him shall be deemed to be profits and gains of business or profession and accordingly chargeable to income-tax as the income of that previous year, whether the business or profession in respect of which the allowance or deduction has been made is in existence in that year or not; or (b) the successor in business has obtained, whether in cash or in any other manner whatsoever, any amount in respect of which loss or expenditure was incurred by the first-mentioned person or some benefit in respect of the trading liability referred to in clause (10 by way of remission o....
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....y revenue stands partly allowed. It has been submitted that assessee for assessment year 2007-08 and 2011-12 has raised similar issues. Grounds 2-14 are in respect of disallowance of a sum of Rs. 27,80,85,386/- under section 40 (a) (ia) of the Act. 9. The Ld.AR submitted that, all contested issue stands squarely covered by order of this Tribunal in assessee's own case for assessment year 2012-13 and 2013-14 reported in (2020) 113 Taxmann.com 530. It is also been submitted that, there is no change in facts and circumstances between the years under consideration as well as subsequent assessment years for which this Tribunal has already took consistent view. 42. We have given a careful consideration to the rival submissions. As far as disallowance of interest of a sum of Rs. 28,98,43,076/- is concerned to the extent of the disallowance relates to interest paid to persons furnished Form 15 G and Form 15 H to the assessee, no disallowance can be made u/s 40a(ia) of the Act as held by the Hon'ble Karnataka High Court in the case of Sri Marikamba Transport Co., (Supra). The requirement of filing of Form 15G and 15H with the prescribed authority viz., CIT is only procedural and th....