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2022 (5) TMI 856 - AT - Income TaxDisallowance claimed u/s 36(1)(viia) - provision for non-performing asset - amount under four heads are not provision for bad and doubtful debts for reserve the amount provided as per Gujarat Co-Operative Society, Act, is not the provision, rather it is a reserve created only if the society makes profit and provision for standard assets, the Assessing Officer held that standard assets cannot be treated to have provided against bad and doubtful debts under the standard assets a performing assets - HELD THAT:- We find that Chennai Tribunal in Tamilnadu State Apex Cooperative Bank Vs ACIT [2014 (1) TMI 1737 - ITAT CHENNAI] while considering the provision for non-performing asset under section 36(1)(viia) held that where the assessee-bank had claimed deduction for 'Provision for Non- Performing Assets' under section 36(1)(viia), in view of fact that taxonomy of provision had been done by assessee to keep it in line with RBI and NABARD guidelines, but in pith and substance provision had been created for 'Bad and Doubtful Debts', deduction was claimed in accordance with section 36(1)(viia) and assessee was entitled to benefit of same. Tribunal in DCIT Vs IGN Vysya Bank [2014 (9) TMI 44 - ITAT BANGALORE] also held that in order to allow assessee's claim under section 36(1)(viia), what has to be seen by Assessing Officer is as to whether provision for bad and doubtful debts is created irrespective of whether it is in respect of rural or non-rural advances by debiting profit and loss account and, to extent provision for bad and doubtful debts is so created, assessee is entitled to deduction subject to upper limit of deduction laid down in said section. In Nanded District Central Co-operative bank Vs DCIT [2014 (10) TMI 613 - ITAT PUNE] also held that deduction under section 36(1)(viia) is to be restricted to the actual amount of provision for bad and doubtful debts made in the books of account. Ahmedabad Tribunal in DCIT Vs Sarvodaya Shakari Bank Ltd [2014 (5) TMI 1182 - ITAT AHMEDABAD] also held that that the provisions for bad and doubtful debts should be allowed u/s. 36(1)(viia), to the extent of provision made and available in the books of account, whether made in the current previous year. Thus, in view of the aforesaid factual discussion, we affirm the order of Ld. CIT(A) by adding our aforesaid observation. - Decided against revenue. Disallowances of centenary celebration expenses, gift distribution and interest relief to society expenses - AO Disallowed the various claims under appeal by taking view that no details and bills/vouchers were not furnished by assessee despite claiming that they are ready to produce such bills/vouchers - CIT(A) deleted the expenses by considering the fact that assessee claimed all evidences were produced before Assessing Officer for verification - HELD THAT:- All the expenses were incurred to celebrate the centenary year. The expense incurred on account of relief fund to celebrate centenary year and are clearly for the purpose of business. There is no personal purpose in making of such expenses, gift items for distributed for valued customers, staff members, and token of appreciation of contribution in helping to boost the business of assessee-bank. Thus all the expenses were incurred wholly and exclusively for the purpose of assessee-bank. Before us Ld. AR for the assessee relied on various case law some of them relate to expense incurred by co-operative societies. We find that in CIT Vs Mehsana Dist. Co-Op. Milk Producers Union Ltd. [1993 (6) TMI 24 - GUJARAT HIGH COURT] Hon’ble Gujarat High Court has allowed the expense incurred on silver jubilee celebration as business expenditure and was treated the expense incurred wholly and exclusively for the purpose of business Further in Karjan Cooperative [1992 (1) TMI 39 - GUJARAT HIGH COURT] allowed the expenditure incurred by assessee- society on giving presents to members on the occasion of its silver jubilee celebration and held that it was incurred wholly and exclusively for the purpose of business. - Decided against revenue.
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