TaxTMI 
TaxTMI 
2025 (7) TMI 593
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....e Ld. CIT(A) erred in deleting addition of Rs. 2,78,63,000/- made by the AO with respect to disallowance of inter office adjustment. 4. Whether on the facts and in the circumstances of the case, the Hon'ble ITAT was right in deleting the addition of Rs. 84,55,68,875/- made u/s 14A read with Rule BD only on following the decision of Hon'ble Supreme Court in the case of Maxopp Investment vs CIT(2018) ignoring the fact that the assessee earned exempt income during the year and the provisions under section 14A were mandatory provisions. To arrive at correct/real income, it was necessary to apportion the expenditure between taxable and non-taxable income. 5. In the facts and circumstances of the case, the Ld. CIT(A) erred in deleting the addition of Rs. 25,86,405/- made by the AO in respect to depreciation of good will, ITAT erred in not appreciating that the disallowance was made on the ground that the goodwill cannot be considered as business or commercial right within the meaning of section 32(1) read with Appendix I of the IT Act. 6. Whether on the facts and in the circumstances of the case, the Hon'ble ITAT was legally justified in allowing de....
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.... relied upon the orders of the authorities below. 7. We have heard the rival submissions and have perused the relevant material on record. We find that this issue has been considered and decided by the Hon'ble High Court of Delhi in ITA No. 193/2024 in assessee's own case vide order dated 06.12.2024 in favour of the assessee and against the Revenue. Vide paras 12 to 16, the Hon'ble High Court has held as under: "12. The third question relates to an addition of Rs.338,13,24,273/-. The Assessee had claimed the said amount on account of amortization of premium on securities held maturity (HTM). A similar question had also arisen in earlier assessment years. 13. The learned counsel for the parties submits that whilst the Revenue has challenged the learned ITAT's order in respect of the AY 2005- 06 and 2006-07, no question of law was framed by this court in ITA No.960/2018. The order dated 22.03.2024 passed by this court in ITA No.960/2018, which relates to the AY 2006-07 indicates that no question of law was framed by this court on the said issue. 14. Mr Rai, the learned counsel appearing on behalf of the Revenue confirms that in fact the Reven....
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....estment or depreciation since the same method is followed by all banks. What is claimed as loss in the computation of securities sold during the year is automatically reduced as the entire accumulated depreciation is deducted while computing the incremental depreciation on securities. Therefore, only the correct profit is reflected in the P&L A/c. 11. It is pointed out that this issue is a recurring issue and is settled in favour of the Bank by the Hon'ble Tribunal and is squarely covered by the decision of the apex Court in UCO Bank vs. CIT (1999) 240 ITR 355(SC) as well as the decisions of Coordinate Benches of ITAT in assessee's own case in earlier years. 12. We have heard the rival submissions and have perused the relevant material on record. We find that in all these cases, the ground raised by the Revenue has been the subject matter of consideration and has been dismissed by the Tribunal. We find that this issue is settled in favour of the assessee by the Tribunal in its own case in ITA 2954/Del/2012 for A.Y 2013-14 dated 13.05.2020 & in ITA 6782/Del/2018 for AY 2014-15 dated 13.04.2022 where the ITAT following the decision of the Hon'ble Apex Court in UCO Bank ....
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....e investments have not been shown in the books as "stock in trade" and its resultant profits on sale are not enhanced by the value of depreciation in subsequent years when these investments are actually sold. 30. In appeal, Ld. CIT(A) considered this issue at length and by following the orders of his predecessor in assessee's own case for the assessment years 2000-01 to 2005-06 decided the issue in favour of the assessee bank in the light of the decision of the Hon'ble Apex Court in the case of UCO Bank vs. CIT 240 ITR 355 (SC). 31. It is the argument of the learned DR that though the assessee has been relying on the orders of the Tribunal for the Assessment Years 2005-06 and 2006-07, facts involved in those matters are entirely different from the facts involved in this matter inasmuch as in Assessment Year 2005-06 the issue before the Tribunal was regarding the acquisition of broken period interest whereas for the assessment year 2006-07 the assessee debited the securities and stock in trade and claimed deduction of loss on the valuation of securities at the year-end on the basis of cost or market price, whichever is lower and confirmed by the orders of the 1st a....
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....naturally when the securities were sold in the subsequent years the profit should be estimated with reference to the reduced value of the Scrips in the earlier years, but however in the case of the assessee, the cost of the security after reducing the same because of the appreciation was not changed or adjusted in the books resulting in the books reflecting the low profit and the resultant offering of less amount to tax. 34. The plea of the assessee, on the other hand, is that the treatment of the profit on sale of securities is a two-fold. Firstly, the profit on sale of securities will be lower due to the non attachment of cost of securities with deregulated appreciation claimed, but simultaneously at the second stage of the said transaction, claim of depreciation on securities for the year is also reduced to the extent of a community depreciation claimed earlier and resultantly the profit for the year is worked out correctly after taking into account both the folds of the transaction collectively. 35. On a careful consideration of the matter, we are of the considered opinion that it's not the case of the Ld. assessing officer that in this particular year in resp....
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....n that the question is now fully covered by the orders of the Tribunal in assessee's own case for the earlier years, and while respectfully following the same, we hold the issue in favour of the assessee. 13. Respectfully following the same, Ground No. 2 and 7 are dismissed. 14. Ground No. 3 pertains to disallowance of inter office adjustment. 15. Facts, in brief, are that the amount shown under "Inter Office adjustment account" appearing in the liability side of the balance sheet pertains to outstanding entries among the branches, controlling offices and head office within the bank which are reconciled regularly on an ongoing basis. As such, these entries are pending for matching /settlement within the bank itself, and so the bank cannot earn any revenue from the adjustment of entries itself inter se branches. Even in the CBS environment, the amounts remain outstanding in the above heads on the particulars day which are reconciled/ settled subsequently on an ongoing basis. 16. Both the rival representatives concurred that this issue is squarely covered in favour of the assessee and against the Revenue by the order the co-ordinate bench in various A.Ys. 17. After con....
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....for the assessee that the amount incurred by the assessee was nothing but the cost for the acquisition of the business and commercial rights in relation to bank's business particularly in South India. The assessee is entitled to claim depreciation @ 25% on the block of intangible assets to acquired commercial rights under the scheme of amalgamation of Nedungadi Bank Ltd. 25. The ld. counsel for the assessee contended that this is a recurring issue and is covered in favour of the Bank by the orders of the Hon'ble Delhi High Court. 26. The ld. DR fairly conceded to the same. 27. We have heard the rival submissions and have perused the relevant material on record. We find that this issue is squarely covered in favour of the assessee and against the Revenue by the decision of Delhi High Court given in assessee's own case in ITA 194/2024 dated 09.12.2024 and ITA 196/2024. Respectfully following the same, Ground No. 5 is dismissed. 28. Ground No. 6 pertains to deduction of Rs. 35,78,00,000/- of an amount credited to PNB Employees Pension Fund u/s 43B of the Act. 29. The assessee is required to pay 10% of the employee's salary as ordinary annual contribution. Th....