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2022 (3) TMI 134 - AT - Income TaxDeduction u/s 36(1)(viia) - assessee calculated deduction based on Aggregate Average Rural Advances (AAA) computed as per Rule 6ABA of the Income-tax Rules, 1962 - AO held that the deduction should be restricted to actual provision made in the books - A.O. disallowed the entire deduction u/s 36(1)(viia) by holding that the sum is debited to the profit and loss account and for income tax computation, the same is added back as it is only a provision which is not an allowable deduction - HELD THAT:- It has been fairly admitted by the learned AR that the issue in question is covered against the assessee by the order of the Tribunal in assessee’s own case for assessment year 2009-2010 [2014 (6) TMI 1052 - ITAT BANGALORE] Deduction u/s 36(1)(vii) - assessee-bank had written off bad debts out of which debts written off by rural branches was adjusted against the provision claimed u/s 36(1 )(viia) and balance was claimed as deduction u/s 36(1 )(vii) - HELD THAT:- We notice that the CIT(A) had expressed the view that provision allowed u/s 36(1)(viia) of the Act would apply to non-rural advances also. An identical issue has been examined by the Hyderabad Bench of the ITAT in the case of State Bank of Hyderabad [2015 (8) TMI 836 - ITAT HYDERABAD] wherein the Tribunal had not accepted the above said view expressed by the CIT(A). The Bangalore Bench of the Tribunal in assessee’s own case for assessment year 2013-2014 [2022 (1) TMI 124 - ITAT BANGALORE] by following the Hyderabad Bench order of the Tribunal in the case of State Bank of Hyderabad (supra), had set aside the view expressed by the CIT(A) that proviso to section 36(1)(vii) which requires adjustment of bad debts against the provisions allowed u/s 36(1)(viia) would apply to non-rural advances also.nce, we direct the A.O. to delete the disallowance made by the CIT(A). It is ordered accordingly. Applicability of provisions of Section 115JB to assessee bank - HELD THAT:- The Tribunal in assessee’s own case for assessment year 2013-2014 [2022 (1) TMI 124 - ITAT BANGALORE] had restored the issue to the files of the CIT(A). The CIT(A) was directed to examine whether the assessee being a banking company would be liable for book profits u/s 115JB - Thus we restore this issue to the files of the CIT(A). Disallowance u/s 14A r.w.r. 8D - HELD THAT:- A perusal of the assessment order, it is clear that the A.O. has recorded the satisfaction and has rejected the assessee’s disallowance u/s 14A of the Act while filing the return of income (the satisfaction can be inferred indirectly). The learned AR also fairly admitted that the matter can be restored to the files of the CIT(A) for de novo consideration. The Tribunal in assessee’s own case for assessment year 2013-2014 had restored the issue of disallowance u/s 14A of the Act to the files of the CIT(A). By following the co-ordinate Bench order of the Tribunal in assessee’s own case, we restore the issue to the files of the CIT(A). Addition u/s 40(a)(ia) - Non deduction of TDS - amount paid to NPCI as charges towards using of ATM of other banks - HELD THAT:- The Tribunal on identical facts in assessee’s own case for assessment year 2013-2014 had held that the assessee is not liable for TDS, and hence, the provisions of section 40(a)(ia) of the Act does not have application in respect of payments made to NPCI - we confirm the CIT(A)’s order and delete the disallowance made by the A.O. by invoking the provisions of section 40(a)(ia) of the Act.
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