ACIT, CIRCLE-2(1), MUZAFFARPUR vs. M/S UTTAR BIHAR GRAMIN BANK, MUZAFFARPUR

Both the captioned appeals of the assessee and the revenue for the assessment years 2012-13 and 2009-10 are directed against the separate order dt. 03.01.2018/14.03.2019 passed u/s. 250 of the Income-tax Act, 1961 [ hereinafter, referred to as ‘the Act’] by the ld. Commissioner of Income-tax, Appeals [ in short, hereafter referred to as ‘the ‘ld. CIT(A), Jamshedpur.

(1) For that the orders of the authorities below are bad in law and fact. (2) For that the learned CIT (Appeals) had issued a notice dt. 18/12/2017 against which adjournment petition was sent through email on 7/12/2017 and specific prayer was made for oral hearing but the same not even acknowledged. (3) For that a confirmatory copy at the adjournment petition was also sent through registered post, on 29/12/2017· i.e. before the date of passing of the order, but even this communication was not acknowledged. (4) For that the ex-parte order, therefore, is unjustified and the addition confirmed is liable to be set aside.

(5) For that the learned assessing officer has grossly erred in making disallowance of Rs. 8,41,31,263/- claimed as expenditure under the head amortization of Government Securities. (6) For that expenditure under the head amortization of Government Securities has been claimed as per prudential norms of the RBI and the premium amortized has been claimed to be in respect of securities held under the category 'held to maturity' and as such the expenditure is fully allowable. (7) For that there is specific Board Instruction No. 17 of 2008 dt. 26/11/2008, which specifies that the premium paid on Government Securities is required to be amortized over the period remaining to maturity. It may kindly be noted that the CBDT instructions are binding on I.T. Authorities. The learned CIT (A) is not justified instating that the guidelines would not apply to RRB. (8) For that the various Benches of ITAT have allowed the amortization of Government Securities as allowable expenditure and therefore the expenditure should also have been allowed in the case of appellant as well. (9) For that in appellants own case, in subsequent year, the amortization of Government Securities has been accepted as allowable expenditure and as such, the CIT (Appeals) has grossly erred in confirming the addition in the assessment year under consideration. (10) For that other grounds, if any, will be urged at the time at hearing.

2. The ld. CIT(A) has erred in law and fact In deleting the addition of Rs. 50,00,000/- made by the AO towards Provisions made for Performing Assets by holding that the provision made in performing assets was allowable contrary to the fact that the provision of section 36(1)(viia) of the Income-tax Act, 1961 relates to Bad & Doubtful debts.

3 The Ld. CIT(A) has erred In law and fact In deleting the addition of Rs.60,00,000/- out of total addition of Rs.1,10,00,000/- without any basis by holding it to be a general phenomena taking place in rural banks.

4. From perusal of the above grounds, we find that the issues raised by both the assessee and revenue are common except for change of figures and year. In the revenue’s appeal for the A.Y 2009-10, the ld. CIT(A) deleted the addition(s) made by the ld. AO whereas for the AY 2012-13 the order of the ld. CIT(A) is ex parte. Though the assessee has filed certain details for AY 2009-10, but for the AY 2012-13 the prayer is that the assessee failed to get fair opportunity to plead its case.

in both the appeals by revenue and assessee for the AYs. 2009-10 and 2012-13 are allowed for statistical purpose.

6. In the result, the appeal of revenue for AY 2009-10 and that of assessee for AY 2012-13 are allowed for statistical purpose.

देश खुले �यायपीठ म� �दनांक 29/12/2022 को उ�घो�षत। The order pronounced in the open Court on 29 -12-2022