TMI Blog2018 (4) TMI 127X X X X Extracts X X X X X X X X Extracts X X X X ..... ue under consideration is identical to AY 2013-14, following the decision of the coordinate bench in the said year, we direct the AO to consider the interest on NPAs as income only in the year of receipt. Accordingly, the addition made on this count is hereby deleted and ground of assessee is allowed. - ITA No. 1336/Hyd/2015 - - - Dated:- 28-3-2018 - Shri D. Manmohan, Vice President And Shri S. Rifaur Rahman, Accountant Member Assessee by : Shri N. Venkataram Revenue by : Smt. N. Swapna ORDER Per S. Rifaur Rahman, A. M. This appeal filed by the assessee is directed against the order dated 30/09/2015 of CIT(A) 5, Hyderabad for AY 2012-13 2. Briefly the facts of the case are, assessee, a cooperative society engaged in the business of banking, file its return of income declaring total income of ₹ 3,56,74,420/-. The AO completed the assessment determining the taxable income at ₹ 4,06,49,359/- by making various additions. When the assessee preferred an appeal before the CIT(A) against the order of AO, the CIT(A) partly allowed the appeal of the assessee. 3. Against the order of CIT(A), the assessee is in appeal before us raising the following ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the submissions of the ld. AR nor brought any contrary decision in this regard. 9. Considered the rival submissions and perused the material on record. As submitted by the ld. AR, we find that the issue in dispute squarely covered by the decision of the coordinate bench in AY 2013- 14 (supra), wherein both of us are party, and the coordinate bench has held as under: 6. Having regard to the rival contentions and the material on record, we find that in the case of CIT vs. Orient Ceramics and Industries Ltd (Supra), the Hon'ble Delhi High Court has followed the decision of the Coordinate Bench of the High Court in the case of CIT vs. BSES Yamuna Powers Ltd to allow depreciation @ 60% on computer peripherals and accessories and also UPS. We find that in the case of CIT vs. BSES Yamuna Powers Ltd, the Hon'ble Delhi High Court was considering the depreciation allowable on computer accessories and peripherals such as, printers, scanners and server etc., which form an integral part of the computer system and cannot be used without the computer. 7. In the case of DCIT vs. Datacraft India Ltd (cited Supra), the Hon'ble Special Bench of the Tribunal at Mumbai was co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the AO to decide the issues in line with the directions given by the ITAT in AY 2013-14. Accordingly, ground Nos. 2 3 are treated as allowed for statistical purposes. 10. As regards ground No. 4 relating to addition on account of interest receivable on NPAs, the AO observed that in the computation of income, the assessee reversed interest on NPA s amounting to ₹ 39,67,923/-. The claim of the assessee was that the Bank had written off the above amount on account of NPAs as per the directives of RBI, which are binding on the banks. The AO observed that the provisions of section 43D of the Act cannot be applied to the assessee bank as it is not a scheduled bank but a cooperative bank. according to AO, non-scheduled cooperative banks are specifically excluded from the exemption including interest of sticky advances. He, therefore, treated the interest on sticky advances as income of the assessee. 11. Before the CIT(A), the assessee submitted elaborately, which were extracted by the CIT(A) in his order. After considering the submissions of the assessee, the CIT(A) discussed the issue at length by referring section 43D and various case law as well as RBI guidelines and he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0- 1984, interest on accrual basis is not taxable if not received for three years even through credited to the suspense account. The court observed that though RBI Act may not override the provisions of Income Tax Act. Income has to be recognised in terms of prudential norms by applying the real income theory. 6. The revenue contended, in the aforecited decision, that Sec. 43D of made, the assessee cannot indirectly claim benefit. On this aspect, the court observed that the benefit was claimed by the assessee not under any provisions of the IT Act, but, on account of the fact that it is bound by the RBI Guidelines, which are issued under the provisions of the RBI Act whereby the interest on NPAs cannot be shown as income. The provisions of sec. 45q of the RBI act would have an overriding effect over the other laws, including the Income Tax Act. Therefore, notwithstanding the provisions of Sec. 43D of the Act, the A.O. is bound to follow the RBI Guidelines so far as the income recognition is concerned. 7. It was thus, finally concluded that interest on NPAs cannot be brought to tax when the actual income is not received. Ld. Counsel for the assessee submitted that the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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