TMI Blog2020 (3) TMI 687X X X X Extracts X X X X X X X X Extracts X X X X ..... wable expenditure u/s 37 of the Act. In our considered opinion, the orders of the Assessing Officer / CIT(A) are fair and reasonable. They do not call for any interference. Accordingly, ground 3 of the assessee is dismissed. Disallowance u/s 14A of the Act read with Rule 8D - HELD THAT:- As relying on the binding judgment of Hon‟ble Bombay High Court in CIT Vs. Reliance Utilities and Power Ltd. [ 2009 (1) TMI 4 - BOMBAY HIGH COURT] we are of the opinion that ld. Counsel demonstrated the disallowance made by the Assessing Officer is uncalled for under Rule 8D(2)(ii) of the Rules. - ITA Nos.1204 to 1206/PUN/2017 - - - Dated:- 16-3-2020 - Shri D. Karunakara Rao, Accountant Member And Shri S.S. Viswanethra Ravi, Judicial Member ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Grounds 1 and 2 relates to the applicability of interpretation of provisions of section 36(1)(viia) of the Act relating to the provision for bad and doubtful debts qua the rural branches / advances. The limited issue raised in these two grounds before us for adjudication relates to the allowability of the deduction of provision for bad and doubtful debts under the said clause (viia) when the assessee is not having any rural branches and therefore, no rural advances. The assessee claimed an amount of ₹ 39,28,906/- as deductible amount. The Assessing Officer rejected the same on the ground that section 36(1)(viia) of the Act does not apply when the assessee does not have rural branches / rural advances. For this proposition, the Assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 12-13. This decision is dated 30.11.2018. The ld. Counsel fairly mentioned that two divergent decisions in his own case for different assessment years. According to him, the CIT(A) relied on earlier unfavourable decision (dated 29.05.2015). The CIT(A)‟s order is also earlier to the cited subsequent order of the Tribunal (favourable only) for the A.Ys. 2007-08 to 2012-13 (supra). On the applicability of the Hon‟ble Supreme Court judgment in the case of Catholic Syrian Bank Ltd. Vs. CIT (supra), Mr. Kishor Phadke, Ld. Counsel mentioned that the said judgment was delivered substantially in the context of clause (vii) of section 36(1) of the Act and not on section 36(1)(viia) of the Act. Referring to the said favourable dec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Then, analyzing the two decisions of Hon ble Bombay High Court, it was held that where two interpretations are possible; one in favour of assessee must be adopted, in turn, relying on the decision of the Hon'ble Supreme Court in CIT Vs. Vegetable Products Ltd. (supra). It was also noted that there were various other High Courts which were not in favour of view taken in CIT Vs. Smt. Godavaridevi Saraf (supra). The Tribunal decided the issue in turn, relying on the ratio laid down by the Hon ble High Court of Gauhati in Smt. Bandana Gogoi Vs. CIT Anr. (2007) 289 ITR 28 (Gau) in the absence of any other decision of any High Court in other State. In view of the above said position of law, we are departing from the view taken by Pune Benc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... disallowed the same u/s 37(1) of the Act on finding that the said expenditure relates to some advertisements connected to demise / birthday greetings / congratulating some politicians, etc. The said details are in para 6.1 of the order of CIT(A). On observing the same, CIT(A) was of the view that the said expenditure was incurred not for the purpose of business. Accordingly, the CIT(A) confirmed the addition as per discussion given in para 6.4 of his order. 12. On hearing both the sides on this issue, we find that the order of CIT(A) is fair and reasonable. For the sake of completeness, para 6.4 of the order of CIT(A) is extracted as under:- 6.4 Ostensibly, the appellant has made expenditure of ₹ 1,27,500/- towards payment to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... part of the total income. On finding the same, disallowances were not made by the Assessing Officer as per provisions of the Act. The Assessing Officer was of the opinion that disallowance of ₹ 7,65,767/- is required to be disallowed. It includes ₹ 72,457/- under Rule 8D(2)(iii) of the Rules. On this disallowance, ld. Counsel has no problem in offering the same. Considering the provisions of the Act / Rules, this part of disallowance is confirmed. 15. However, the above disallowance also includes sum of ₹ 6,93,310/- disallowed by Assessing Officer under clause (2)(ii) of Rule 8D of the Rules. In this regard, ld. Counsel submitted before the Tribunal that the assessee is flushed with adequate interest free reserves wh ..... X X X X Extracts X X X X X X X X Extracts X X X X
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