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2016 (11) TMI 665 - AT - Income TaxAddition on account of interest income in relation to advances classified as Non-Performing Advances (NPAs) - Held that:- When the account becoming NPA is not disputed by the revenue, the recognition of income is to be done only on receipt basis which is in consonance with the real income theory. In these circumstances and respectfully following the decisions of Hon’ble Delhi High Court in [2010 (11) TMI 88 - Delhi High Court ] and various other decisions referred to supra, we hold that the interest income on NPA accounts should not be assessed on mercantile basis and the same is to be taxed only on receipt basis. Accordingly, the grounds raised by the assessee are allowed. Addition on account of deemed short term capital gains - Held that:- It is not in dispute before us that the renovations work carried out by the assessee in the subject mentioned building (which was sold in the year under appeal and dispute before us) was added in the 10% block by the assessee in the earlier years and depreciation claimed accordingly. We find that this depreciation had been granted by the revenue all along. Going by the principle of consistency, there is no need to disturb the said stand of the revenue. But since the entire building ( including the renovated portion) was sold during the year under appeal for ₹ 9.55 crores, we find that the assessee bank had rightly allocated the sale consideration towards 5% an 10% block on the basis of their values and computed short term capital gains u/ 50 of the Act for the 5% block and claimed depreciation u/s 32 of the Act for the 10% block. It is not in dispute that the 10% block continues to exist as on 31.3.2010. MAT applicability to assessee bank - applicability of provisions of section 115JB - Held that:- The provisions of section 115JB of the Act are not applicable to an assessee unless it is registered as a company under the Companies Act, 1956 and prepares its financial statements in accordance with the provisions of section 211 and Part II and Part III of Schedule VI of the Companies Act, 1956. We place reliance on the recent decision of the co-ordinate bench of this tribunal in the case of UCO Bank vs DCIT (2015 (12) TMI 300 - ITAT KOLKATA ) wherein held that the amendment brought in by the Finance Act 2012 in section 115JB of the Act is applicable only from Asst Year 2013-14 onwards and not earlier. Respectfully following the said judicial precedent, we hold that the provisions of section 115JB of the Act are not applicable to the assessee bank for the year under appeal. Disallowance on account of provision for gratuity - Held that:- We find that assessee had actually paid the amount of ₹ 2,18,00,000/- in the earlier year i.e in Asst Year 2009-10 itself along with other amounts. However, deduction for the same has not been claimed in that year i.e in Asst Year 2009-10 and the same has been claimed in the year under appeal i.e the year in which it had become due. We agree with the argument of the ld AR that the spirit of section 43B of the Act has been satisfied by the assessee in full TDS credit - Held that:- The circumstances in which the said TDS has been remitted to the account of the Central Government and the circumstances based on which the refund of the same is claimed by the assessee is not disputed by the revenue before us. We find that the revenue is unjustly enriched by the TDS amount paid by the assessee and since the said TDS is duly reflected in the Form 26AS of the assessee , the assessee is entitled for the credit of the said TDS in his assessment which the revenue has got no authority to deny as per law. Accordingly, we find that the direction given by the ld DRP to the ld AO to grant credit of TDS is in order and does not call for any interference.
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