TaxTMI 
TaxTMI 
TaxTMI 
2025 (8) TMI 1664
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....ct, 1961 (hereinafter referred to as 'the Act'), dated 13.05.2024, which in turn arises out of an assessment order passed by the Assessing Officer u/s 147 r.w.s. 144/ 144B of the Act, dated 31.03.2022. 2. The grounds of appeal raised by the assessee are as follows: "1. The order passed u/s 147 r.w.s. 143(3) and the notice u/s 148 is bad in law. 2. The Learned Commissioner of Income-tax (Appeals), Income Tax Department NFAC, Delhi erred in sustaining the disallowance of Rs. 43,77,323/- out of total claim of deduction of Rs. 83,77,323/- made by the assessee u/s 36(1)(viia) of the Act in the return of income filed for the year. 3. The assessee craves leave to add, amend, alter and withdraw any ground of appeal any time up to the hearing....
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....ons was required to be reviewed on 31/03/2013 and adjusted to reflect the current best estimate. The Provision should be reversed and accordingly the amount of the reversed provision should be 'offered to tax as deemed to have arisen as per the section 5 of the Act. Therefore, assessing officer noted that as per balance sheet, as on 31/03/2013, the amount to be reversed was 43.98 lacs (3,30.98 - 2,67.00- 20.00/current year provision). Therefore, there was under assessment of Rs. 43,98,000/- is required to be added of the total income of the assessee. 4. Further, on verification of case records, it was also noticed by the assessing officer that the computation of income of assessment year (A.Y.) 2013-14 revealed the assessee had claimed....
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....spect of allowance of the provision of bad and doubtful debts u/s 36(1)(viia) of the Act, therefore, these amounts have remained unexplained. Therefore, assessing officer held that the amount to the tune of Rs. 1,27,75,323/- ( Rs. 43,98,000 + Rs. 83,77,323/-) has escaped assessment within the meaning of section 147 of the Act, for the assessment year (A.Y.) 2013-14 and therefore re-opening was within the meaning of section 147 of the Act. 6. Aggrieved by the order of Assessing Officer, the assessee carried the matter in appeal before Ld.CIT(A), who has partly deleted the addition made by the Assessing Officer. The ld CIT(A) observed that the disallowance of Rs. 43,98,000/- has no basis, when the assessee had not made the corresponding clai....
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....ed a reasoned and speaking order, therefore, order passed by the ld. CIT(A) should be upheld, and further relief should not be given to the assessee. 9. We have heard the rival contentions, perused the material on record and duly considered facts of the case in the light of the applicable legal position. We note that the assessee is a Co-operative Bank, carrying on the business of banking and thus the provisions of section 80P(4) and 36(1)(vii) and 36(1)(viia) of the Act have their application. Subsequently, on perusal of the case records and more particularly the computation of income for the assessment year, 2013-14, it came to light that the claim of provision of bad & doubtful debts u/s 36(1)(viia) of Rs. 83,77,323/- was incorrect and ....
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....partly. 10. Now, coming to the balance disallowance of Rs. 83,77,323/-, which is the provision for bad debts deducted in the computation of total income, the ld. Counsel for the assessee had pleaded that it is within the limits prescribed towards NPA provisioning as per the first and second limb of section 36(1)(viia)(a) of the Act. Being a Co-operative Bank, 7.5% of the profits before claim of any deduction under Chapter VIA and 10% of the aggregate average advances made by the rural branches of the bank have to be allowed. When this quantum so arrived, is in excess of claim made by the assessee of Rs. 83,77,323/-, there is no reason to disallow the same. The ld CIT(A) has agreed that computation of total income with regard to the quantif....
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.... We have examined the above computation of total income and observed that assessee has computed the deduction u/s 36(1)(viia) of the Act, as per the procedure laid down in the said section. The computation of total income of the assessee, is placed at page No.2 of paper book, wherein the amount was claimed on account of provision for bad and doubtful debts, to the tune of Rs. 83,77,323/- and this is the deduction u/s 36(1)(viia) of the Act, for provision for bad and doubtful debts, as per the scheme of the said section, that is, an amount 7.5% of the total income ( computed before making any deduction under this clause and chapter VIA) and an amount, not exceeding 10% of the aggregate average advances made by the rural branches of such ban....