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2018 (9) TMI 1021 - AT - Income TaxInterest income on NPA accounts assessment - to be assessed on mercantile basis OR receipt basis - Held that:- As decided in assessee's own case [2018 (9) TMI 415 - ITAT KOLKATA] 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 VASISTH CHAY VYAPAR LTD. [2010 (11) TMI 88 - DELHI HIGH COURT] and various other decisions referred to by the ld AR and in view of this issue being already decided in favour of the assessee by this tribunal in its own case 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 ground nos. 2(a) to 2(d) raised by the assessee are allowed.” Disallowance of payment made to employees against the provision made for unfunded pension - Held that:- As decided in assessee's own case there was no contribution made by the assessee bank to any of the funds. The payments were directly made to the employees of the bank and subjected to deduction of tax at source. The moment the payments are made to those employees, the assessee had lost complete control over those funds and it had not come back to the assessee in any manner whatsoever either by creation of any fund managed by it or otherwise. From the approval letter of the competent authority of the assessee bank, we find that these payments were made only to meet the increased cost of living of the employees and hence it is effectively a payment made as a welfare measure . Hence the provisions of section 40A(9) of the Act as heavily relied upon by the ld DR is not at all applicable to the facts of the instant case. Disallowance of write off of CENVAT credit - Held that:- AR fairly conceded before us that this sum of ₹ 46 crores was allowed as deduction by this Tribunal in assessment year 2011-12 [2018 (9) TMI 415 - ITAT KOLKATA] and hence the same should be disallowed in assessment year 2012-13 in order to avoid double deduction. We are in agreement with this fair representation by the ld. AR and accordingly uphold the disallowance made in the sum of ₹ 46 crores for assessment year 2012-13 in order to avoid double deduction to the assessee. Addition towards interest on income tax refund - AR vehemently prayed for setting aside of this entire issue for both the assessment years to the file of ld. AO for de novo adjudication with liberty to the assessee to raise fresh grounds in the light of protocol to India-Netherlands DTAA read with India-Italy DTAA vis-à-vis the most favoured nation clause agreed in the protocol to India-Netherlands DTAA - Held that:- DR fairly considered for de novo adjudication of this issue by the ld. AO. Hence we deem it fit and appropriate, in the interest of justice and fair play, to remand this entire issue to the ld. AO for both assessment years 2012-13 and 2013-14 for de novo adjudication of the issue and decide the same afresh in accordance with law. The assessee is at liberty to furnish additional evidences and raise fresh grounds, contentions with regard to this issue for both the assessment years under appeal before us
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