UNION BANK OF INDIA (ERSTWHILE-ANDHRA BANK),MUMBAI vs. DY. COMMISSIONER OF INCOME TAX , CIRCLE-1(1), HYDERABAD

ITA 193/HYD/2019Status: DisposedITAT Hyderabad21 April 2025AY 2015-16Bench: SHRI VIJAY PAL RAO (Vice President), SHRI MADHUSUDAN SAWDIA (Accountant Member)43 pages
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What did the Tribunal hold?

The Tribunal held that investments classified as 'Held to Maturity' (HTM) by RBI, when held to comply with statutory liquidity ratio, are stock-in-trade and depreciation on them is allowable. However, investments not in the nature of stock-in-trade are to be valued at cost without depreciation.

What were the facts?

The assessee, Union Bank of India, filed its return of income for AY 2015-16. The Assessing Officer made several additions, including disallowance of provision for bad and doubtful debts under Section 36(1)(viia) and disallowance of depreciation on investments. The CIT(A) partly allowed the assessee's appeal.

What were the issues?

Whether provisions for NPA are considered as provisions for bad and doubtful debts for deduction, and whether depreciation on investments classified as HTM is allowable.

Which sections of the Income-tax Act were involved?

Section 36(1)(viia),Section 14A,Section 36(1)(vii)

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Cases cited in this judgment(6)Show list

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Income Tax Appellate Tribunal, Hyderabad ‘B’ Bench, Hyderabad

Before: SHRI VIJAY PAL RAO & SHRI MADHUSUDAN SAWDIA

Hearing: 10.02.2025

Heard together (2 matters)

ITA No.193/Hyd/2019
ITA No.316/Hyd/2019

Read from the judgment's own cause title. This page is filed under one of them.

PER MADHUSUDAN SAWDIA, A.M. : These cross appeals are filed by Union Bank of India (“the assessee”) and the revenue, feeling aggrieved by the order passed by the Learned Commissioner of Income Tax (Appeals)-1, Hyderabad (“Ld. CIT(A)”), dated

ITA Nos.193 & 316/Hyd/2019 2

07.12.

2018 for the A.Y. 2015-16. Since the issues are inter-connected, they are heard

The order continues below.

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