Deduction in respect of provision for bad and doubtful debts made by banks.

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..... banks, of an amount not exceeding 5% of the total income and an amount not exceeding 2% of the aggregate average advances made by the rural branches of such banks computed in the prescribed manner. Prior to 1-4-1987, the amount of admissible deduction was an amount not exceeding 10% of the total income or an amount not exceeding 2% of the aggregate average advances made by the rural branches, whi .....

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..... tion 36(1)(viia) relates only to the rural branches and hence the bad debts of urban branches need not be set off against the same. 3. This view is not correct. Section 36(1)(viia) merely taken into account the quantum of the aggregate average advances of the rural branches for the purposes of quantifying the permissible deduction for the provision made and does not say that the provision itself .....

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