M/s Narmada Jhabua Gramin Bank, Indore V. Dypti Commissioner Of Income Tax, 3(1),Indore, Indore

ITA 549/Ind/2017

• Counselvise Citation: [2018] 122 COUNSELVISE.COM (IT) 4135 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 2 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-10-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2014-2015
• Appeal Filed On: 02-08-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: LALCHAND
• Assessee Lawyers: S S DESH
• Section: 143(3)

Judgement Text

NARMADA JHABUA GRAMIN BANK ITA NO.549/IND/2017 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ITA NO.549/IND/2017 ASSESSMENT YEAR: 2014-15 REVENUE BY S HRI LAL CHAND, CIT ASSESSEE BY SHRI S.S. DESHPANDE ,C.A DATE OF HEARING 11. 10 . 2018 DATE OF PRONOUNCEMENT 12 .10 .2018 O R D E R PER MANISH BORAD, AM. THIS APPEAL OF ASSESSEE PERTAINING TO A.Y. 2014-15 IS DIRECTED AGAINST THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-I, INDORE (IN SHORT CIT(A)), DATED 22.05.2017 WHICH IS ARISING OUT OF THE ORDER U/S 143(3) OF THE INCOME TAX ACT 1961(HER EINAFTER CALLED AS THE ACT) FRAMED ON 17.03.2016 BY DCIT-3(1), IN DORE. 2. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS; M/S. NARMADA JHABUA GRAMIN BANK, 201, ARCADE SILVER, 56 SHOPS, INDORE VS. DCT - 3(1) INDORE ( APPELLANT ) (RESPONDENT ) PAN NO. AABAN6105D NARMADA JHABUA GRAMIN BANK ITA NO.549/IND/2017 2 1. THAT LD.CIT(A) HAS ERRED IN MAINTAINING THE DIS ALLOWANCE OF THE CLAIM OF THE ASSESSEE MADE U/S 36(1)(VII)(A). 2. IT WAS PROVED BEFORE THE LD.AO AND THE LD.CIT(A) THAT THE ASSESSEE IS ENTITLED TO THE DEDUCTION U/S 36(1)(VII)(A) EVEN IF NO RESERVE IS CREATED. THE ASSESSEE RELIED ON THE DECISION OF THE HON'BLE SUPR EME COURT IN THE CASE OF M/S. SOUTHERN TECHNOLOGIES LTD. VS CIT AND THE DECI SION OF THE BANGALORE BENCH IN THE CASE OF SYNDICATE BANK VS. DCIT. 3. AT THE OUTSET LEARNED REPRESENTATIVE FOR THE ASS ESSEE CONCEDED TO THE FACT THAT THE ISSUE RAISED IN THE I NSTANT APPEAL STANDS ALREADY DECIDED AGAINST THE ASSESSEE BY THE CO-ORDINATE BENCH, INDORE IN THE CASE OF M/S. NARMADA MALWA GRA MEEN BANK V/S ACIT 2(1), INDORE M.A.NO.104/IND/202 (ARISING O UT I.T.A. NO.162/IND/2011). 4. PER CONTRA LD. DEPARTMENTAL REPRESENTATIVE SUPPO RTED THE ORDERS OF LOWER AUTHORITIES AS WELL AS THE ORDER OF TRIBUNAL IN THE CASE OF M/S. NARMADA MALWA GRAMEEN BANK V/S ACIT 2(1), INDORE. 5. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE RECORDS PLACED BEFORE US. THE ASSESSEES GRIEVANCE IS REGA RDING THE DISALLOWANCE OF CLAIM U/S 36(1)(VII)(A) OF THE ACT . IT IS CONTENDED IN NARMADA JHABUA GRAMIN BANK ITA NO.549/IND/2017 3 THE GROUNDS OF APPEAL THAT THE ASSESSEE IS ENTITLED TO THE DEDUCTION U/S 36(1)(VII)(A) EVEN IF NO RESERVE IS CREATED. W E HOWEVER FIND THAT THE SAME ISSUE STANDS DECIDED AGAINST THE ASSESSEE S APPEAL BY THE CO-ORDINATE BENCH IN THE CASE OF M/S. NARMADA MALWA GRAMEEN BANK V/S ACIT 2(1), INDORE(SUPRA) HOLDING AS FOLLO WS THAT THE DEDUCTION U/S 36(1)(VII)(A) OF THE ACT IS TO BE ALL OWED ONLY TO THE EXTENT OF AMOUNT WRITTEN OFF IN THE BOOKS OF ACCOU NTS:- 2. THROUGH THIS PETITION IT WAS CONTENDED BY LEARNE D A.R. THAT TRIBUNAL HAS NOT DECIDED THE GROUND RAISED WITH RESPECT TO ALLOWABILITY OF CLAIM OF DEDUCTION U/S 36(1)(VIIA) OF THE I.T. ACT, HOWEVER, THE MATTER HAS BEEN RESTORED TO THE FILE OF THE ASSESSING OFFICER TO RECOMPUTED THE CLAIM OF DEDUCTION TO THE EX TENT OF AMOUNT WRITTEN OFF IN THE BOOKS OF ACCOUNT THOUGH SUCH WRI TE OFF WAS NOT PARTYWISE. 3. WE HAVE GONE THROUGH THE ORDER OF THE TRIBUNAL DA TED 29/03/2013 WHEREIN THE ISSUE WITH REGARD OF ALLOWABI LITY OF CLAIM OF DEDUCTION U/S 36(1)(VIIA) OF THE ACT WAS DECIDED AFTER DISCUSSING VARIOUS DECISIONS OF HON'BLE SUPREME COURT AS WELL AS HIGH COURT IN PARA 11 TO 16, THE ISSUE WITH REGARD OF QUANTIFICAT ION OF DEDUCTION U/S 36(1)(VIIA) WAS RESTORED TO THE FILE OF THE ASSE SSING OFFICER FOR RECOMPUTING THE CLAIM OF DEDUCTION TO THE EXTENT OF A MOUNT WRITTEN OFF IN THE BOOKS OF ACCOUNT, EVEN THOUGH SUCH WRITE OFF WAS NOT PARTYWISE. THE CONTENTION OF LEARNED A.R. WAS THAT FULL AMOUNT OF PROVISION FOR BAD AND DOUBTFUL DEBT SHOULD BE ALLOWED IRRESPECTIVE OF NARMADA JHABUA GRAMIN BANK ITA NO.549/IND/2017 4 ENTRY MADE IN THE BOOKS OF ACCOUNT. WE ARE NOT IN AGREEMENT WITH THE ASSESSEES CONTENTION IN SO FAR AS PROVISION CO NTAINED IN CLAUSE (VIIA) OF SECTION 36 CLEARLY STARTS WITH THE WORD I N RESPECT OF PROVISION FOR BAD AND DOUBTFUL DEBT MADE BY SCHEDULE BAN K. THUS, TO THE EXTENT OF PROVISION MADE FOR BAD AND DOU BTFUL DEBTS IN THE BOOKS OF ACCOUNT, CAN BE ALLOWED. WE DO NOT FIN D ANY MISTAKE IN THE ORDER OF THE TRIBUNAL, WHICH CAN BE RECTIFIED U/ S 254(2) OF THE ACT. ON THE CONTRARY, THE TRIBUNAL HAS GIVEN A FAVOURABL E FINDING AND DIRECTION TO THE ASSESSING OFFICER TO ALLOW THE CLA IM OF DEDUCTION TO THE EXTENT OF AMOUNT WRITTEN OFF IN THE BOOKS OF AC COUNT NOTWITHSTANDING THE FACT THAT SUCH WRITE OFF WAS NO T PARTYWISE. THIS OBSERVATION WAS MADE KEEPING IN VIEW THE VERDICT OF HON'BLE SUPREME COURT IN THE CASE OF VIJAYA BANK 323 ITR 16 6. 6. WE THEREFORE IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND RESPECTFULLY FOLLOWING THE DECISION OF CO-ORDINATE BENCH DISMISS THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE. 7. IN THE RESULT THE APPEAL OF THE ASSESSEE IS DISM ISSED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 12.10.20 18. SD/- SD/- ( KUL BHARAT) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER / DATED : 12 OCTOBER, 2018 /DEV NARMADA JHABUA GRAMIN BANK ITA NO.549/IND/2017 5 COPY TO: THE APPELLANT/RESPONDENT/CIT CONCERNED/CIT (A) CONCERNED/ DR, ITAT, INDORE/GUARD FILE. BY ORDER ASSTT.REGISTRAR,I.T.A.T., INDORE