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Order u/s.254(1)of the Income-tax Act,1961(Act) लेखा सद� राजे� के अनुसार PER RAJENDRA, AM- Challenging the order dt.04.08.2014 of CIT(A)-I,Mumbai,the Assessee and the Assessing Officer(AO)have filed cross appeals for the above mentioned assessment year.Assessee is a Co-operative bank registered with Maharashtra Bank and is engaged in functioning of Bank as per frame work of Banking Regulations Act,1949.It filed its return of income 14.10.2010,declaring total income at Rs.13,18,31,547/-.The assessment order u/s.143(3) of the Act, was passed on 14.03.2013, determining the total income of the assessee at Rs.48.56 crores under normal provisions of the Act. ITA.7295/Mum/2014: 2.The only effective ground ,raised by the assessee ,s with regard to restricting the claim/deduction u/s.36(1)(viia) to the extent of provision of Bad and Doutful debts of Rs.3.50crores against total claim /deduction of Rs.32.78crores. 2.1.During the course of hearing before us, the Authorised Representative (AR) fairly conceded that identical issue had arisen in the matter of M/s. Gopinath Patil Parsik Janata Sahkari Bank Ltd. and was decided against the assessee-bank by the Tribunal(ITA/7134/M/2012,dtd-31.12.2015).We find that while deciding
7226 & 7295/M/14-Thane District Central Co-opBank (10-11) the appeal for AY.2009-10,in the case of M/s.Gopinath Patil Parsik Janata Sahkari Bank Ltd.(supra),the Tribunal has dealt the issue as under :- “5. Before us,the Ld. A.R. of the assessee has fairly admitted that the above issue raised by the assessee in its appeal is squarely covered against the assessee by the decision of the Pune Bench of the Tribunal in the case of “Shri Warana Sah. Bank Ltd. vs. ACIT” in and ITA No.347/PN/2013 vide order dated 16.04.14 wherein the Tribunal, after analyzing the provisions of section 36(1)(viia) and relying upon another decision of the Tribunal in the case of “Shri Mahalaxmi Co-op bank Ltd. vs. ITO” vide ITA No.1658/PN/2011 dated 29.10.13, has held that the deduction for provision for bad and doubtful debts should be restricted to the amount of such provision actually credited in the books of the assessee in the relevant year.
So far as the alternate plea of the assessee is concerned, the issue is squarely covered by the decision of the Mumbai Bench of the Tribunal in the case of “State Bank of India vs. DCIT” (2014) 148 ITD 71 wherein the Tribunal has held that when the claim of deduction has been specifically provided under section 36(1)(viia), then merely provision made on the basis of RBI guidelines does not become allowable. In view of the above, there is no merit in the appeal of the assessee and the same is accordingly dismissed. ……” 2.3.Respectfully following the above order, effective Ground of Appeal is decided against the assessee .
ITA/7226/Mum/2014: 3.The only effective ground taken by the Revenue is with regard to deleting the addition on account of amortization premium of investments in Government securities amounting to Rs.2,13,34,250/-. Representatives of both the sides agreed that identical issue stands decided against the AO by the order of the Tribunal delivered in the case of M/s. Gopinath Patil Parsik Janata Sahkari Bank Ltd.(supra).We find that the Tribunal has dealt the issue of amortisation of securities as under : “8. The issue involved in the appeal of the Revenue is relating to the amortization of loss on account of premium paid on HTM (Held to Maturity) investments. At the outset, the Ld. A.R. of the assessee has stated that the issue is squarely covered in favour of the assessee by the decision of the Tribunal in the case of “HDFC Bank Ltd. vs. DCIT” in & Others vide order dated 12.11.14.
We have gone through the case law relied upon by the assessee. In the case of HDFC Bank Ltd. (supra), the Tribunal has allowed the amortization of loss arisen on account of premium paid on ‘Investments held to maturity’ as deductable following the decision of the Hon’ble Bombay High Court in the case of “CIT vs. HDFC Bank Ltd.” (2014) 366 ITR 505.
7226 & 7295/M/14-Thane District Central Co-opBank (10-11)
The Ld. D.R. has fairly agreed that the issue is squarely covered by the above decision. Further, the Ld. A.R. of the assessee has brought our attention to the another decision of the Hon’ble Bombay High Court in the case of “CIT vs. Thane Bharat Sahakari Bank Ltd. in of 2013 decided on 17.03.15 wherein the Hon’ble Bombay High Court has upheld the finding of the Tribunal holding that the expenditure on account of reclassification of ‘Held to maturity’, securities represent revenue expenditure and not capital expenditure and is thus required to be spread over the life of the security and is proportionately allowable as right off from year to year as per the guidelines issued by RBI.
In view of the above, we do not find any merit in the appeal of the Revenue and the same is accordingly dismissed.” 3.1.Respectfully following the order of the Tribunal we, decide the effective Ground of Appeal against the AO.