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2013 (10) TMI 1291 - AT - Income TaxSuspense, individual and Society - CIT(A) deleted the addition - Held that:- The issues raised in the ground are fully covered in favour of the assessee by the decision of ACIT vs. Rohtak Central Co-op. Bank Ltd. [2011 (6) TMI 728 - ITAT DELHI] wherein also the assessee was a cooperative society engaged in accepting deposits and giving loans as per guidelines of NABARD. If the amount deposited in the said account belong to the various depositors, who intended to open the bank account with the assessee, then the said amount cannot attain the character of 'income' in the hands of the assesee unless it is shown that the said amount has become the income of the assesee. If the said amount does not belong to the assessee and the assessee has utilized the same until the said amount is refunded back, no notional interest can be added to that amount as either the assesee has to pay interst if the said amount is credited to the saving account or the amount itself has to be refunded back in case the account is not opened. There is no question of assessing any notional interest on the said amount.- Decided in favour of assessee. Suspense interest realized - CIT(A) deleted the addition - Held that:- Submission of the assessee which is well supported by RBI / NABARD circular dated 17.8.2002 vide para No. 3.1 clearly states that the policy of income recognition should be based on record of recovery and therefore unrealized income should not be taken into profit and loss account by State Co-op Bank / Central Co-op Banks and that the provisions of Section 43D of the Act are clear regarding the recognition of interest income on NPA. The Ld. CIT(A) in our view has thus rightly held that overdue interest not realized during the year and credited to suspense interest account cannot be taken tobe the income of the assessee. Thus the Ld. CIT(A) has thus rightly deleted the addition in question. - Decided in favour of assessee.
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