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2019 (4) TMI 373 - HC - Income TaxBad debts written off - HELD THAT:- The allowance of written off bad debts in non-rural branches will be confined to the excess allowed from the provision made and deduction allowed for non-rural branches. We make it clear that in making the computation, there can be no consideration of the provision for bad debts for rural branches as granted under sub-clause (viia) of Section 36. Appellant is not a 'financial corporation' entitled to deduction u/s 36(1) (vii) - HELD THAT:- This Court in the Federal Bank Limited v. Assistant Commissioner of Income Tax [2011 (1) TMI 1184 - KERALA HIGH COURT]. Hence the question is answered against the assessee and in favour of the revenue. Exemption 10(23G) - HELD THAT:- it is only proper that the Assessing Officer considers the certificates produced by the assessee and grant allowance to the extent the claim is substantiated. Revaluation of Interest Rates Swaps (IRS) - interest rates fluctuations in the market - HELD THAT:- lower authorities have taken a view that it is only a notional revaluation and there can be no deduction allowed for the same. We confirm the order of the lower authorities and answer the question against the assessee and in favour of the revenue. Addition u/s 14A - HELD THAT:- Issue against the revenue and in favour of the assessee in C.I.T. v. Essar Teleholdings Pvt.Ltd. [2018 (2) TMI 115 - SUPREME COURT OF INDIA]. It has been held by the Hon'ble Supreme Court that the machinery provision for giving effect to Section 14A of the Income Tax Act came into effect only from the assessment year 2008-09. Hence, there can be no application of Section 14A to the subject year. The question is answered against the revenue and in favour of the assessee. Deduction u/s 36(1)(vii) - HELD THAT:- The procedure as prescribed therein would also be a write off. It is the contention of the assessee Bank that the assessee had actually written off the amounts as has been found in Vijaya Bank [2010 (4) TMI 46 - SUPREME COURT]. In such circumstances, it is only proper that the Assessing Officer verify the Balance Sheet of the assessee, produced for the year and decide the question of deduction under Section 36(1)(vii)of the Act, in consonance with Vijaya Bank (supra) and the declaration made therein.
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