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2018 (3) TMI 1100 - AT - Income TaxClaim of deduction in the computation of income in respect of reversal of NPA interest credited to Profit & Loss Account - Held that:- In the present case before us, assessee has made a provision at ₹ 246891000/- in P&L a/c under the head Provision for Bad and Doubtful Debts. Moreover there is no dispute with relation to amount of claim and the manner of computation. AO in his order has not disputed the quantum of amount claimed as deduction. Assessee has claimed ₹ 144090700/- which is much lesser than actual provision made. Therefore as per CBDT circular instructions and judicial pronouncements there should not be any reason to disallow the claim of the assessee. This further clarify the intention of Government that due to hardships in granting rural advances by banks, Government as an incentive wants to allow the deduction to scheduled as well as non scheduled banks. We find from the facts of the case that the area of operation of the assessee bank is restricted to Buldhana District, having 106 branches in rural areas. The loans and advances are given to farmers residing in rural areas. - Decided in favour of assessee
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