DCIT, Circle-3(2), Hyd, Hyderabad V. State Bank of Hyderabad, Hyd, Hyderabad

ITA 500/HYD/2016

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 6283 (ITAT-HYDERABAD)
• Duration Of Justice: 3 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-07-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2013-2014
• Appeal Filed On: 07-04-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S NARASAMMA
• Assessee Lawyers: LAXMINIWAS SHAR MA
• Keywords: Bad and doubtful debts

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B, HYDERABAD BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI LALIET KUMAR, JUDICIAL MEMBER ITA NO. 500/HYD/2016 ASSESSMENT YEAR : 2013-14 DY. COMMISSIONER OF INCOME TAX, CIRCLE-3(2), HYDERABAD. VS. M/S STATE BANK OF HYDERABAD, HYDERABAD. PAN: AADCS 4009 H APPELLANT RESPONDENT FOR REVENUE: SMT. S. NARASAMMA (D.R.) FOR ASSESSEE: SHRI LAXMINIWAS SHARMA (AR) DATE OF HEARING: 25/07/2016 DATE OF PRONOUNCEMENT: 27/07/2016 O R D E R PER LALIET KUMAR, J.M. : THIS IS THE APPEAL FILED BY THE REVENUE ARISE S AGAINST THE ORDER DATED 25/01/2016 PASSED BY THE LD. CIT(A)-3, HYDERABAD FOR THE A.Y. 2013-14, WHEREIN THE REVENUE HAS RAISED THE FOLLOWING GROUNDS: 1. THE LD. CIT(A) ERRED BOTH IN LAW AND ON FACTS OF THE CASE 2. THE LD. CIT(A) ERRED IN ALLOWING SEPARATE DEDUCT ION U/S 36(1)(VII) OF RS. 337,30,00,000/- WHEN THE PROVISION U/S 36(1)(VIIA) IS INCLUSIVE OF URBAN I.T.A. NO. 500/HYD/2016 DCIT VS. STATE BANK OF HYDERABAD :- 2 -: ADVANCES, WHICH AMOUNTS TO DOUBLE DEDUCTION AND NOT PERMISSIBLE IN LAW. 3. THE LD. CIT(A) OUGHT TO HAVE APPRECIATED THAT TH E DECISION OF CATHOLIC SYRIAN BANK VS. CIT IS NOT APPLICABLE TO THE FACTS OF THE CASE OF THE ASSESSEE WAS INCLUSIVE OF THE URBAN ADVANCES ALSO WHICH ARE SEPARATELY ALLOWABLE U/S 36(1)(VII) AND THEREFORE AMOUNTS TO DOUBLE DEDUCTION WITH RESPECT TO THESE ADVANCES. 4. THE LD. CIT(A) OUGHT TO HAVE APPRECIATED THAT TH E DECISION OF CATHOLIC SYRIAN. 2. THE ASSESSEE IS A BANKING COMPANY AND IS A SUBSI DIARY OF THE STATE BANK OF INDIA, MUMBAI. THE ASSESSE HAS CLAI MED DEDUCTION RELATING TO AMOUNT U/S 36(1)(VII) OF THE INCO ME TAX ACT, 1961 (IN SHORT THE ACT) AMOUNTING TO RS. 337,30,00 ,000/- AND DEDUCTION RELATING TO THE PROVISIONS MADE TOWARDS R URAL AND NON-RURAL ADVANCES U/S 36(1)(VIIA) OF THE ACT AMO UNTING TO RS. 1067,04,71,985/- BEING BAD AND DOUBTFUL DEBTS @ 7 .5% OF TOTAL INCOME OF RS. 233,49,08,249/- AND RURAL BRANCH ADVANCES @ 10% OF THE AGGREGATE OF RS. 833,55,63,736/-. THE PROVISIONS CREATED BY THE ASSESSEE IN THE BOOKS OF ACCOUNT AMOUNTI NG TO RS. 1041.63 CRORES TOWARDS RURAL BRANCHES AND ALSO F OR NON- RURAL BRANCHES. THE LD A.O. AFTER DISTINGUISHING THE J UDGMENT OF HONBLE SUPREME COURT IN THE CASE OF CATHOLIC SYRIAN B ANK VS. CIT (2012) 343 ITR 0270 (SC) HAS DISALLOWED THE DEDU CTION U/S I.T.A. NO. 500/HYD/2016 DCIT VS. STATE BANK OF HYDERABAD :- 3 -: 36(1)(VIIA) AS WELL AS SECTION 36(1)(VII) OF THE ACT. THE REASONING OF THE LD. A.O. IS GIVEN IN PARAGRAPH NO. 4.15 TO 4.1 6, WHICH IS REPRODUCED HEREUNDER:- 4.15 THE DECISION OF HONBLE SUPREME COURT IN THE CATHOLIC SYRIAN BANK IS ENTIRELY RESTS ON THIS UNDISPUTED FACT THAT PROVISION U/S 36(1)(VIIA) IS SPECIFIC AND RELATES ONLY TO THE RURAL ADVANCES. A REFERENCE IS MADE TO PARA 4.13 OF THIS ORDER WHEREI N THE HONBLE SUPREME COURT CLEARLY HELD THAT CLAUSE (VIIA) IN SUB SECTION 1 OF SECTION 36 WAS INSERTED TO PROMOTE THE RURAL BANKING AND TO ASSIST THE SCHEDULED COMMERCIAL BANKS IN MAKING ADEQUATE PROVISIONS AGAINST THE RISKS OF THEIR RURAL ADVANCE S. THE HONBLE SUPREME COURT EXPRESSLY STATED THAT THE DEDUCTION IS LIMITED TO A SPECIFIC PERCENTAGE OF TH E AGGREGATE AVERAGE ADVANCES MADE BY THE RURAL BRANCHES COMPUTED IN THE MANNER PRESCRIBED BY THE IT RULES. THEREFORE, WHAT FOLLOWS IS THAT THE HONB LE SUPREME COURT RELIED ON THE FACTS OF CATHOLIC SYRIN A BANK IN WHICH CASE THE PROVISION U/S 36(1)(VIIA) WA S LIMITED ONLY TO THE RURAL ADVANCES. EVEN OTHERWISE, FROM A SIMPLE READING OF THE DECISION OF THE SUPREM E COURT, IT BECOMES EVIDENT THAT THE SUPREME COURT OBSERVED THAT PROVISION UNDER CLAUSE (VIIA) IS LIMI TED TO THE RURAL ADVANCES AND THAT THE SAME RURAL ADVANCES CANNOT BE CLAIMED TWICE SINCE THE I.T.A. NO. 500/HYD/2016 DCIT VS. STATE BANK OF HYDERABAD :- 4 -: EXPLANATION TO CLAUSE (VII) LIMITS THE AMOUNT OF ALLOWANCE. 4.16 AS STATED ABOVE, IN RESPECT OF DEDUCTION UNDE R SECTION 36(1)(VIIA) IS CONCERNED THE ASSESSEE HAS MADE A PROVISION OF RS. 1041.63 CRORES IN ITS BOOKS OF ACCOUNT (PAGE 107 OF ANNUAL ACCOUNTS) TOWARDS BAD DEBTS. THIS PROVISION INCLUDES RS. 980.97 CRORES FO R NON-RURAL BRANCHES AND RS. 60.66 CRORES FOR RURAL BRANCHES. AS PER THE DISCUSSION IN THE PRECEDING PARAS, THE AMOUNT OF URBAN BAD DEBITS WRITTEN OFF I N THE BOOKS OF ACCOUNT IS NOT CONTROLLED OR LIMITED I N ANY WAY BY THE PROVISO TO CLAUSE (VII), WHICH MEANS THE BAD DEBTS ACTUALLY WRITTEN OFF IN THE ACCOUNTS OF B ANK REPRESENTING URBAN ADVANCES IS AN ALLOWABLE DEDUCTION. FOLLOWING THE SUPREME COURT JUDGMENT THE CLAIM UNDER SECTION 36(1)(VII) IS ALLOWED AT RS. 337,30,00,000/- AS THE SAME IS LESS THAN THE PROVISION MADE IN THE BOOKS OF ACCOUNT AT RS. 980.9 7 CRORES. 3. BEING AGGRIEVED BY THE ORDER PASSED BY THE LD. A. O., THE ASSESSEE CARRIED THE MATTER BEFORE THE LD CIT(A). THE LD CIT(A) RELIED UPON THE ORDER PASSED BY THE TRIBUNAL PASSED IN ITA NO. 450/HYD/2015 ORDER DATED 14/08/2015 HAS ALLOWED THE APPEAL OF THE ASSESSEE. RELEVANT PARAGRAPH OF THE ORDER OF I TAT RELIED UPON BY THE LD CIT(A) IS AS UNDER:- I.T.A. NO. 500/HYD/2016 DCIT VS. STATE BANK OF HYDERABAD :- 5 -: 39. WE HAVE CONSIDERED THE SUBMISSIONS OF THE PART IES AND PERUSED THE ORDERS OF REVENUE AUTHORITIES AS WELL A S OTHER MATERIALS ON RECORD. ON CAREFUL ANALYSIS OF SECTION U/S 36(1)(VIIA) OF THE ACT, IT IS VERY MUCH CLEAR THAT ASSESSEE BEING A SCHEDULE BANK CAN CLAIM DEDUCTION IN RESPECT OF P ROVISION FOR BAD AND DOUBTFUL DEBTS MADE IN ITS BOOKS OF ACC OUNT, WHICH DOES NOT EXCEED THE AGGREGATE OF AMOUNT NOT EXCEEDI NG 7.5% OF THE TOTAL INCOME COMPUTED BEFORE MAKING ANY DEDU CTION U/S 36(1)(VIIA) AND CHAPTER-VIA AND AN AMOUNT NOT E XCEEDING 10% OF THE AGGREGATE AVERAGE ADVANCES MADE BY RURAL BRANCHES OF SUCH BANK COMPUTED IN TERMS WITH THE PR ESCRIBED RULES. THUS, ON READING OF THE AFORESAID PROVISION, IT IS VERY MUCH CLEAR THAT FOR CLAIMING DEDUCTION UNDER THE SA ID PROVISION, ASSESSEE HAS TO FULFILL TWO CONDITIONS, FIRSTLY, IT MUST HAVE MADE A PROVISION FOR BAD AND 22 ITA NOS. 450, 498 & 499 /HYD/2015 STATE BANK OF HYDERABAD DOUBTFUL DEBTS IN ITS BOOKS OF ACCOUNT AND SECONDLY THE MAXIMUM DEDUCTION ALLOWABLE IS TO THE EXTENT OF 7.5% OF THE TOTAL INC OME AND 10% OF THE AGGREGATE AVERAGE ADVANCES MADE BY RURAL BRA NCHES OF SUCH BANK. ON A READING OF THE PROVISIONS OF SECTIO N 36(1)(VIIA), AS IT STANDS NOW, IT IS VERY MUCH CLEA R THAT THERE IS NO RESTRICTION IMPOSED UNDER THE SAID PROVISION TO INDICATE THAT ASSESSEE CANNOT MAKE A PROVISION FOR NON-RURAL /URBAN ADVANCES. THAT BEING THE CASE, DEPARTMENTS ARGUMEN T THAT DEDUCTION U/S 36(1)(VIIA) HAS TO BE RESTRICTED ONLY TO THE EXTENT OF PROVISION FOR BAD AND DOUBTFUL DEBTS RELA TING TO RURAL ADVANCES, IN OUR VIEW, IS NOT ACCEPTABLE. PROVISION CONTAINED U/S 36(1)(VIIA), WAS EXAMINED BY THE ITAT BANGALORE BENCH IN CASE OF CIT VS. ING VYSYA BANK (SUPRA). THE ITAT AF TER I.T.A. NO. 500/HYD/2016 DCIT VS. STATE BANK OF HYDERABAD :- 6 -: CONSIDERING THE LEGISLATIVE HISTORY OF SECTION U/S 36(1)(VIIA) FROM ITS INCEPTION HAS LUCIDLY EXPLAINED THE TRUE I MPORT OF SECTION U/S 36(1)(VIIA) AS IT STANDS IN THE PRESENT FORM. FOR BETTER CLARITY, WE THOUGHT IT PROPER TO REPRODUCE T HE OBSERVATIONS OF THE ITAT BANGALORE BENCH IN EXTENSO , WHICH ARE AS UNDER: 34. IT CAN BE SEEN FROM THE HISTORY OF SEC.36(1)(V IIA) OF THE ACT THAT AT STAGE-I THE DEDUCTION WAS ALLOWED IN RE SPECT OF ANY PROVISION FOR BAD AND DOUBTFUL DEBTS MADE BY A SCHEDULED BANK IN RELATION TO THE ADVANCES MADE BY ITS RURAL BRANCHES. AT THIS STAGE THE PBDD HAD TO BE LI NKED TO THE ADVANCES MADE BY BANKS RURAL BRANCHES. AT STAGE-II OF SEC.36(1)(VIIA), THE DEDUCTION WHILE COMPUTING THE TAXABLE PROFITS WAS ALLOWED OF AN AMOUNT NOT EXCEEDING TEN PER CENT OF THE TOTAL INCO ME (COMPUTED BEFORE MAKING ANY DEDUCTION UNDER THE PROPOSED NEW PROVISION) OR TWO PER CENT OF THE AGGREGATE AVERAGE ADVANCES MADE BY RURAL BRANCHES O F SUCH BANKS, WHICHEVER IS HIGHER. AT THIS STAGE ALSO THE PBDD HAD TO BE CREATED AND DEBITED TO THE PROFIT AN D LOSS ACCOUNT BUT WAS NOT REQUIRED TO BE DONE IN REL ATION TO ADVANCES MADE BY BANKS RURAL BRANCHES AND CAN B E IN RELATION TO ANY DEBT. PBDD NEED NOT BE IN RELATI ON TO RURAL ADVANCES BUT CAN BE IN RELATION TO ANY ADVANC ES BOTH RURAL AND NON-RURAL ADVANCES. THE TWO PERCENT AAA MADE BY RURAL BRANCHES OF SUCH BANKS HAD TO BE COMPUTED AND THE PBDD MADE IN BOOKS HAS TO BE IN RELATION TO RURAL ADVANCES. THE OTHER ELIGIBLE SUM WHICH CAN BE CONSIDERED FOR DEDUCTION U/S.36(1)(VIIA) OF THE ACT VIZ., TEN PER CENT OF THE TOTAL INCOME (COMPUTE D BEFORE MAKING ANY DEDUCTION UNDER THE PROPOSED NEW PROVISION) DOES NOT REQUIRE COMPUTATION IN RELATION TO RURAL ADVANCES. NEVERTHELESS THE DEBIT OF PBDD TO P ROFIT AND LOSS ACCOUNT IS NECESSARY OF THE HIGHER OF THE TWO SUMS TO CLAIM DEDUCTION U/S.36(1)(VIIA) OF THE ACT. IF THE I.T.A. NO. 500/HYD/2016 DCIT VS. STATE BANK OF HYDERABAD :- 7 -: CONCERNED BANK DOES NOT HAVE RURAL BRANCHES THEN TH EY COULD NOT CLAIM THE DEDUCTION. THEREFORE THE DEDUCT ION WAS CONFINED ONLY TO BANKS THAT HAD RURAL BRANCHES. 35. AT STAGE-III OF THE PROVISIONS OF SEC.36(1)(VI IA) OF THE ACT, THE DEDUCTION ALLOWED EARLIER WAS ENHANCED. TH E ENHANCEMENT OF THE DEDUCTION WAS CONSEQUENT TO REPRESENTATION TO THE GOVERNMENT THAT THE EXISTING CEILING IN THIS REGARD I.E. 10% OF THE TOTAL INCOME OR 2% OF THE AGGREGATE AVERAGE ADVANCES MADE BY THE RURAL BRANCHES OF INDIAN BANKS, WHICHEVER IS HIGHER, SHOU LD BE MODIFIED. ACCORDINGLY, BY THE AMENDING ACT, THE DEDUCTION PRESENTLY AVAILABLE UNDER CL. (VIIA) OF S UB-S. (1) OF S. 36 OF THE IT ACT HAS BEEN SPLIT INTO TWO SEPARATE PROVISIONS. ONE OF THESE LIMITS THE DEDUCTION TO AN AMOUNT NOT EXCEEDING 2% (AS IT EXISTED ORIGINALLY, NOW IT IS 10%) OF THE AGGREGATE AVERAGE ADVANCES MADE B Y RURAL BRANCHES OF THE BANKS CONCERNED. THIS WILL IM PLY THAT ALL SCHEDULED OR NON-SCHEDULED BANKS HAVING RU RAL BRANCHES WOULD BE ALLOWED THE DEDUCTION (A) UPTO 2% (NOW 10%) OF THE AGGREGATE AVERAGE ADVANCES MADE BY SUCH BRANCHES AND (B) A FURTHER DEDUCTION UPTO 5% O F THEIR TOTAL INCOME IN RESPECT OF PROVISION FOR BAD AND DOUBTFUL DEBTS. THE FURTHER DEDUCTION OF 5% OF TOTA L INCOME WAS AVAILABLE TO BANKS WHICH DID NOT HAVE RU RAL BRANCHES. 36. THEREFORE AFTER 1.4.1987, SCHEDULED OR NON-SCH EDULED BANKS HAVING RURAL BRANCHES WERE ALLOWED DEDUCTION. , (A) UPTO 2% (NOW 10%) OF THE AGGREGATE AVERAGE ADVANCES MADE BY SUCH BRANCHES AND (B) SCHEDULE OR NON-SCHEDULED BANKS WHETHER IT HAD RURAL BRANCHES O R NOT A DEDUCTION UPTO 5% OF THEIR TOTAL INCOME IN RE SPECT OF PROVISION FOR BAD AND DOUBTFUL DEBTS. EVEN UNDER THE NEW PROVISIONS CREATING A PBDD IN THE BOOKS OF ACCOUNTS IS NECESSARY. I.T.A. NO. 500/HYD/2016 DCIT VS. STATE BANK OF HYDERABAD :- 8 -: 37. THOUGH UNDER STAGE-II AND STAGE-III OF THE PR OVISIONS OF SEC.36(1)(VIIA) OF THE ACT, PBDD HAS TO BE CREATED BY DEBITING THE PROFIT AND LOSS ACCOUNT OF THE SUM CLA IMED AS DEDUCTION, THE CONDITION THAT THE PROVISION SHOU LD BE IN RESPECT OF RURAL ADVANCES IS NOT NECESSARY. AT S TAGE-II OF THE PROVISIONS OF SEC.36(1)(VIIA) OF THE ACT, TH IS CONDITION WAS DONE AWAY WITH AND IT WAS ONLY NECESSARY TO CREATE PBDD IN THE BOOKS OF ACCOUNTS A ND DEBIT TO PROFIT AND LOSS ACCOUNT. THE QUANTIFICATIO N OF THE MAXIMUM DEDUCTION PERMISSIBLE U/S 36(1)(VIIA) O F THE ACT HAD TO BE DONE. FIRSTLY IT HAS TO BE ASCERT AINED AS TO WHAT IS 10% OF THE AGGREGATE AVERAGE ADVANCES MADE BY RURAL BRANCHES, IF THE BANK HAS RURAL BRANC HES, OTHERWISE THAT PART OF THE DEDUCTION U/S.36(1)(VIIA ) OF THE ACT WILL NOT BE AVAILABLE TO THE BANK. THE SECO ND PART OF THE DEDUCTION U/S.36(1)(VIIA) HAS TO BE ASCERTAINED VIZ., 7.5% SEVEN AND ONE-HALF PER CENT OF THE TOTAL INCOME (COMPUTED BEFORE MAKING ANY DEDUCTION UNDER THIS CLAUSE AND CHAPTER VI-A). THE ABOVE ARE THE PERMISSIBLE UPPER LIMITS OF DEDUCTIONS U/S.36(1)(VI IA) OF THE ACT. THE ACTUAL PROVISION MADE IN THE BOOKS BY THE ASSESSEE ON ACCOUNT OF PBDD (IRRESPECTIVE OF WHETHE R IT IS RURAL OR NONRURAL) HAS TO BE SEEN. TO THE EXTENT PBDD IS SO CREATED, THEN SUBJECT TO THE PERMISSIBLE UPPE R LIMITS REFERRED TO ABOVE, THE DEDUCTION HAS TO BE ALLOWED TO THE ASSESSEE. THE QUESTION OF BIFURCATIN G THE PBDD AS ONE RELATING TO RURAL ADVANCES AND OTHER ADVANCES (NON-RURAL ADVANCES) DOES NOT ARISE FOR CONSIDERATION. AS CAN BE SEEN FROM THE AFORESAID OBSERVATION OF TH E BANGALORE BENCH, IT HAS BEEN HELD IN CLEAR TERMS THAT ACTUAL PROVISION MADE BY ASSESSEE ON ACCOUNT OF PROVISION FOR BAD AND DOUBTF UL DEBT IRRESPECTIVE OF THE FACT WHETHER IT IS RURAL OR NON -RURAL, HAS TO BE SEEN WHILE EXAMINING ASSESSEES CLAIM OF DEDUCTION U/S 36(1)(VIIA). IF THE BANK DOES NOT HAVE RURAL BRANCH, IT WILL NOT GE T DEDUCTION I.T.A. NO. 500/HYD/2016 DCIT VS. STATE BANK OF HYDERABAD :- 9 -: RELATING TO 10% OF AGGREGATE AVERAGE ADVANCES MADE BY RURAL BRANCHES. HOWEVER, IT WILL BE ELIGIBLE TO CLAIM DED UCTION OF 7.5% OF TOTAL INCOME. THE BENCH FURTHER HELD THAT BIFURCATI NG THE PROVISION FOR BAD AND DOUBTFUL DEBT AS ONE RELATING TO RURAL ADVANCES AND OTHER ADVANCES (NON-RURAL) DOES NOT ARISE FOR CONSI DERATION. CONSIDERED IN THE AFORESAID PERSPECTIVE, REASONING OF THE AO IN CONFINING THE DEDUCTION CLAIMED U/S 36(1)(VIIA) ONL Y TO THE PROVISION MADE TOWARDS RURAL ADVANCES, IN OUR VIEW, IS NOT IN ACCORDANCE WITH THE STATUTORY PROVISION. ON THE OTHER HAND, THE VIE W EXPRESSED BY LD. CIT(A) WHILE ALLOWING ASSESSEES CLAIM OF DEDUCTION IS AS PER THE STATUTORY PROVISION. ACCORDINGLY, WE DO NOT FIND AN Y INFIRMITY IN THE ORDER OF LD. CIT(A) IN ALLOWING ASSESSEES CLAIM OF DEDUCTION FOR RS. 616.55 CRORES U/S 36(1)(VIIA). 4. NOW THE REVENUE IS IN APPEAL BEFORE US. THE LD D R HAS RELIED UPON THE ORDER PASSED BY THE LD. A.O. AND HAS SUBMITTED THAT THE ORDER PASSED BY THE A.O. IS REQUIRED TO BE UPHELD. 5. AT THE OUTSET, THE LD AR OF THE ASSESSEE HAS SUB MITTED THAT THE ORDER OF THE LD CIT(A) IS IN ACCORDANCE WITH THE EA RLIER JUDGMENT PASSED BY THE HONBLE TRIBUNAL, THEREFORE, THIS ISSUE IS R EQUIRED TO BE ALLOWED IN FAVOUR OF THE ASSESSEE. 6. WE HAVE GONE THROUGH THE RIVAL CONTENTIONS OF BOTH THE PARTIES, PERUSED THE MATERIAL AVAILABLE ON THE RECORD AND ALSO GONE THROUGH THE GROSS PROFIT AS PER THE P&L ACCOUNT. AS PER THE RECORD, ACTUAL URBAN BAD DEBTS WERE WRITTEN OFF TO THE TUNE I.T.A. NO. 500/HYD/2016 DCIT VS. STATE BANK OF HYDERABAD :- 10 -: OF RS. 337,30,00,000/-. BY RESPECTFULLY FOLLOWING TH E JUDGMENT REFERRED HEREINABOVE IN THE PRECEDING PARAGRAPH IN T HE CASE OF THE ASSESSEE IN ITA NO. 450/HYD/2015 ORDER DATED 14/08/2015, THIS ISSUE IS DECIDED IN FAVOUR OF THE A SSESSEE AND AGAINST THE REVENUE. RESPECTFULLY FOLLOWING THE JUDGMENT OF THE COORDINATE BE NCH IN THE CASE OF THE ASSESSEE, THE APPEAL OF THE REVENUE IS DISMISSED. 10 IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON 27/07/2016. SD/- SD/- ( B. RAMAKOTAIAH ) (LALIET KUMAR) ACCOUNTANT MEMBER JUDICIAL MEMBER HYDERABAD, DATED 27 TH JULY, 2016 *RANJAN COPY FORWARDED TO: 1. DY. COMMISSIONER OF INCOME TAX, CIRCLE-3(2), 7 TH FLOOR, B BLOCK, IT TOWERS, AC GUARDS, HYDERABAD, 2. M/S STATE BANK OF HYDERABAD, HEAD OFFICE, GUNFOUND RY, HYDERABAD. 3. CIT(APPEALS)-3, HYDERABAD. I.T.A. NO. 500/HYD/2016 DCIT VS. STATE BANK OF HYDERABAD :- 11 -: 4. PR.CIT-3, HYDERABAD. 5. D.R. ITAT, HYDERABAD. 6. GUARD FILE.