COMMISSIONER OF INCOME TAX vs. VIJAYA BANK

IN THE HIGH COURT OF KARNATAKA AT BANGALORE

DATED THIS THE 11TH DAY OF MARCH 2013

PRESENT

THE HON'BLE MR.JUSTICE N.KUMAR

AND

THE HON'BLE MR. JUSTICE B.MANOHAR

ITA NO.687/2008

BETWEEN:

…Appellants

(By Sri.K.V.Aravind, Advocate)

AND:

Vijaya Bank, No.41/2, M.G.Road, Bangalore – 560 001.

….Respondent

(By Sri.Sarangan, Sr. Counsel along with Sri.K.S.Ramabhadran, Advocate)

ITA filed u/s.260-A of I.T.Act, 1961 arising out of Order dated 24-01-2008 passed in ITA.No.253/Bang/2007, for the Assessment Year 2003- 2004, praying that this Hon’ble Court may be pleased to formulate the substantial questions of law stated therein and allow the appeal and set aside the orders passed by the ITAT, Bangalore in ITA.No.253/Bang/2007, dated 24-01-2008 confirming the order of the Appellate Commissioner and confirm the order passed by the Assistant Commissioner of Income Tax, Circle – 12 (3), Bangalore in the interest of justice and equity.

This appeal is coming on for hearing this day, N. KUMAR J., delivered the following:

J U D G M E N T

The Revenue has preferred this appeal challenging the order passed in ITA.No.253/Bang/2007, dated 24-01-2008 by the Income Tax Appellate Tribunal (hereinafter referred to as ‘the Tribunal’) holding that the assessee is entitled to value all the investment at

cost prices or market value whichever is lower by treating such investment as stock-in-trade. Aggrieved by the said order, the Revenue is in appeal before us. 2. The substantial question of law which is framed in this case reads as under:

“Whether the Tribunal was correct in allowing depreciation claim of Rs.39,21,52,485/- on “held on maturity’ investments by treating it as stock-in-trade despite the same not being traded on a regular basis by the assessee in accordance with RBI and CBDT circulars?

Sd/-

JUDGE

Sd/-

JUDGE

mpk/-*