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2015 (4) TMI 1100 - AT - Income TaxAddition on account of interest on NPA u/s.43D - Held that:- By the insertion of a special provision to tax interest income in the case of public financial institution, etc. section 43-D has to be applied in its letter and spirit. It is pertinent to mention that later on, in the case of CIT vs. Bank of America S.A. [2003 (3) TMI 84 - BOMBAY High Court] the question of interest on “sticky loans” was decided in favour of the assessee and held that the question is to be answered in favour of the assessee following the decision of UCO Bank reported at(1999 (5) TMI 3 - SUPREME Court ). Likewise, in an another case of CIT vs. State Bank of India (2003 (3) TMI 88 - BOMBAY High Court ) again it was held that the amount credited to the interest suspense account was not taxable following the decision pronounced in the case of UCO Bank (supra). No infirmity in the order of the CIT(A) directing the AO to delete the addition on account of interest receivable on NPA on accrual basis. - Decided in favour of assessee Disallowance u/s 14A - Held that:- No disallowance u/s.14A is required when the assessee earns tax free dividend income on investments which are held as stock in trade of the assessee. - Decided in favour of assessee
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