2013 (7) TMI 656 - KARNATAKA HIGH COURT

Depreciation on securities - Computation of income of Bank - Revenue held Assessee violated RBI guidelines - Tribunal declined to grant depreciation - Held that:- method of accounting adopted by the tax payer consistently and regularly cannot be discarded by the Departmental authorities on the view that he should have adopted a different method of keeping the accounts or on valuation - RBI Act or Companies Act do not deal with the permissible deductions or exclusion under the IT Act - if the assessee has consistently treating the value of investment for more than two decades as investment as stock-in-trade and claim depreciation, it is not open to the authorities to disallow the said depreciation on the ground that in the balance-sheet it is shown as investment in terms of the RBI Regulations - The question whether the assessee is entitled to particular deduction or not will depend upon the provision of law relating thereto and not the way, in which the entries are made in the books of accounts - Following decision of UNITED COMMERCIAL BANK v/s COMMISSIONER OF INCOME TAX [1999 (9) TMI 4 - SUPREME Court] and SOUTHERN TECHNOLOGIES LIMITED v/s THE JOINT COMMISSIONER OF INCOME TAX [2010 (1) TMI 5 - SUPREME COURT OF INDIA] - Decided in favour of assessee.