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2015 (5) TMI 1029 - AT - Income TaxAddition on account of unclaimed liability - Held that:- Smilar issue of recognition of unclaimed liability and its non-taxability arose before the Pune Bench of the Tribunal in The Ahmednagar Merchants Co-operative Bank Ltd. vs. JCIT [2015 (4) TMI 1088 - ITAT PUNE] wherein held Once the liability has been shown and recognized by the assessee in its books of account, then even if the liability is unclaimed and relates to earlier years, does not convert it into the income of the assessee. As the assessee continues to recognize the liability and once the liability has been so recognized by the assessee, there is no merit in treating the same as income of the assessee though some of the amounts may not be recoverable by application of provisions of Limitation Act. - Addition deleted - Decided in favour of assessee Addition on account of unclaimed dividend - Held that:- We find no merit in the order of the CIT(A) where the unclaimed dividend was not established to be a receipt of the assessee in the course of its trading transactions. - Decided in favour of assessee Partial addition on account of the balance shown in the suspense account - Held that:- Reliance on the ratio laid down by the Chennai Bench of the Tribunal in ACIT vs. Karur Vysya Bank Ltd., (2013 (11) TMI 923 - ITAT CHENNAI) wherein it was held that the unclaimed balance and surplus of jewellery auction could not be added to the income of the assessee - Decided in favour of assessee Addition made on account of premium paid on investment in Government securities - CIT(A) deleted addition - Held that:- This issue is covered in favour of assessee by the order in the case of Nagar Urban Co-operative Bank Ltd [2015 (6) TMI 553 - ITAT PUNE] as held Law is well settled that the Securities held by the Bank are in the nature of Stock-in-Trade Both the authorities below have merely gone on the nomenclature of the head under which the Securities are held. In our considered view, nomenclature cannot be decisive for the assessee Bank. We, therefore, hold that Addition made on account of premium paid on investment in Government securities is to be deleted - Decided in favour of assessee Addition made on account of payment of broken period interest on investment held in the HTM securities - Held that:- There is no difference in the amount in tax, whether one adopts the assessee's method or the Department's method. Under either method, the same amount is offered for tax. The Department has not been able to show in this case as to why the method adopted by the assessee-bank ought to be rejected. On the other hand, the Department has not been able to explain as to why broken period interest received should be taxed whereas broken period interest payment should be disallowed - Decided against Revenue. Addition on provision for NPA, investment in Madhavpura Mercantile Co-operative Bank Ltd. - Held that:- the issue is in relation to an investment made by the assessee with Madhavpura Mercantile Cooperative Bank Ltd. and in view of the financial strain faced by the said Bank and also because of the advice of the Auditors, whether provision of such NPA investment is to be allowed as business loss in the hands of the assessee or as capital loss. Since the issue has not been considered in total perspective and following the principles of natural justice, we are of the view that the matter be remitted back to the file of the Assessing Officer, who shall after verifying the stand of the assessee, vis-à-vis the entries made by the assessee in its books of account, shall re-adjudicate the issue in accordance with law. - Decided in favour of revenue for statistical purposes.
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