THE SOUTH INDIAN BANK LIMITED,THRISSUR V. DCIT, CIRCLE 1(1)&TPS, THRISSUR

ITA 287/COCH/2024

AI Insights

The case involves The South Indian Bank Ltd., which appealed against the order of the National Faceless Appeal Centre, Delhi, concerning the assessment year 2017-18. The primary contention was regarding the disallowance of bad debts written off and the additional claim of provisional bad and doubtful debts. The original assessment by the AO included various disallowances, which were later contested and partially revised under section 263 by the PCIT. The CIT(A) upheld the AO's revised assessment, leading to the current appeal. The Tribunal's decision emphasized the limitation on introducing new claims in revisionary proceedings under section 263.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 714391 (ITAT-COCHIN)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-08-2025
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Assessment Year: 2017-2018
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: VENI RAJ
• Assessee Lawyers: NARESH C
• Keywords: Set aside; Bad and doubtful debts; Depreciation
• Section: 143(3); 263

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH BEFORE SHRI INTURI RAMA RAO, AM AND SHRI SONJOY SARMA, JM ITA No. 287/Coch/2024 Assessment Year: 2017-18 The South Indian Bank Ltd., .......... Appellant Head Office, Mission Quarters, T.B. Road, Thrissur. [PAN: AABCT 0022 F] vs. Dy. Commissioner of Income Tax .......... Respondent Circle-1(1) & TPS, Thrissur Appellant by: Shri Naresh C, CA Respondent by: Smt. Veni Raj, CIT-DR Date of Hearing: 12.06.2025 Date of Pronouncement: 04.08.2025 O R D E R Per: Inturi Rama Rao, AM This appeal filed by the assessee is directed against the order of the National Faceless Appeal Centre, Delhi [CIT(A)] dated 07.02.2024 for Assessment Year (AY) 2017-18. 2. Brief facts of the case are that the assessee is a private scheduled bank, engaged in the business of banking. The return of income for the A.Y. 2017-18 was filed on 31/03/2018 declaring income of Rs. 446,81,29,140/-. Against the said return of income, the assessment was completed by the DCIT, Circle-1(1) & TPS, Printed from counselvise.com 2 ITA No. 287/Coch/2024 The South Indian Bank Ltd. Thrissur (for short, 'AO') vide order dated 31/03/2018 passed u/s. 143(3) of the Income Tax Act, 1961 (for short, 'the Act') at a total income of Rs. 526,91,03,478/- after making disallowances of Rs. 11,94,53,780/- u/s.14A of the Act; Rs. 65,64,94,855/- u/s. 36(1)(viii) of the Act; Rs. 86,00,775/- under ESOS employee expense and Rs.97,43,48,563/- under non-remitted NPS. Subsequently, the learned Principal Commissioner of Income Tax, Kozhikode (PCIT) in exercise of powers conferred on him u/s. 263 of the Act, set aside the assessment to the file of the AO for verification of the claim in respect of bad debts written off and depreciation on investments. Pursuant to the order of learned PCIT, the AO passed the consequential order u/s. 143(3) r.w.s. 263 of the Act vide order dated 25/03/2022 at a total income of Rs. 534,66,04,672/-. While doing so, the AO restricted deduction u/s. 36(1)(viiia) to 7.5% of the total income, however allowed the claim of depreciation on investments. 3. Being aggrieved, the assessee filed an appeal before the learned CIT(A) contending that AO ought not have disallowed a sum of Rs.14,10,36,183/- being difference in bad debts written off and also not allowed the additional claim of provisional bad and doubtful debts of Rs. 52 crores. However, learned CIT(A) considering the movement of the provisions for NPAs held that AO had rightly disallowed the bad debts written off and also the provisional bad debts of Rs. 52 crores which cannot be allowed in Printed from counselvise.com 3 ITA No. 287/Coch/2024 The South Indian Bank Ltd. the assessment made pursuant to the revisionary order passed by the learned PCIT. 4. Being aggrieved, the assessee is in appeal before this tribunal in the present appeal. 5. We have heard the rival submissions and perused the material on record. The issues raised in the present appeal does not emanate from the consequential assessment order passed u/s. 143(3) r.w.s. 263 of the Act. These are the additional claims made before the Ld. CIT(A) against the order of assessment passed u/s. 143(3) r.w.s. 263 of the Act. The revisionary proceedings u/s. 263 are prejudicial to the assessee, no additional claim or new claim is admissible in the proceedings consequent to the order passed u/s. 263 of the Act. It is also settled position of law that the AO while passing the consequential order to the order of revision u/s. 263, should not travel beyond the scope of the revision order. In view of this legal position, we do not find any merit in the grounds of appeal filed by the assessee. 6. In the result, the appeal filed by the assessee stands dismissed. Order pronounced on 04th August, 2024 under Rule 34 of The Income Tax (Appellate Tribunal) Rules, 1963. Sd/- Sd/- (SONJOY SARMA) JUDICIAL MEMBER (INTURI RAMA RAO) ACCOUNTANT MEMBER Cochin, Dated: 04th August, 2025 Printed from counselvise.com 4 ITA No. 287/Coch/2024 The South Indian Bank Ltd. vr/-. Copy to: 1. The Appellant 2. The Respondent 3. The Pr. CIT concerned 4. The Sr. DR, ITAT, Cochin 5. Guard File By Order Assistant Registrar ITAT, Cochin Printed from counselvise.com "