TMI Blog2023 (1) TMI 1227X X X X Extracts X X X X X X X X Extracts X X X X ..... dry creditors etc and never the unilateral act on the part of the appellant by writing off of the amount and credit to Profit Loss Account neither amount to cessation of liability or income. In the circumstances, we direct the Assessing Officer to allow this ground of appeal no.1. Allowability of deduction u/s 36(1)(viii) - The appellant bank had derived income on lending money for the purpose of purchase construction of houses. There is no dispute that the appellant is specified entity being the cooperative bank as per sub-clause (4) of section 36(1)(viii) of the Act. The term long term finance has been defined under clause (h) to mean any loan or advance provided for a period for not less than 5 years. We do not perceive any di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... edited to Reserve Fund - 3,11,237/- (ii) Disallowance of provision of Standard assets - 10,00,000/- (iii) Disallowance of broken period interest - 33,22,899/- (iv) Disallowance of amortization of premises - 4,88,614/- (v) Disallowance of special Reserve u/s 36(1)(viii) - 9,78,821/- Total - 61,01,567/- 3. Being aggrieved by the above additions, an appeal was filed before the ld. CIT(A), who vide impugned order, confirmed the additions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 36(1)(viii) and also carried on the eligible business and complied with all the conditions prescribed under the provisions of section 36(1)(viii) of the Act. The ld. AR submits that the lower authorities have misconstrued the term development of housing in India . 7. On the other hand, ld. Sr. DR placed reliance on the orders of the lower authorities. 8. We heard the rival submissions and perused the material on record. The ground of appeal no.1 challenges the decision of the ld. CIT(A) confirming the addition of Rs.3,11,237/- being the amount transferred to the capital reserve account. The AR submits that the amount transferred to capital reserve fund represents the entrance fees collected from its shareholders of Rs.2,65,400/-, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had derived income on lending money for the purpose of purchase construction of houses. There is no dispute that the appellant is specified entity being the cooperative bank as per sub-clause (4) of section 36(1)(viii) of the Act. The term long term finance has been defined under clause (h) to mean any loan or advance provided for a period for not less than 5 years. We do not perceive any distinction between term development of housing in India and purchase construction of housing in India for residential purposes. Thus, we are of the considered opinion that the claim made by the appellant clearly falls within the exemption under the provisions of section 36(1)(viii) of the Act and the assessee bank is entitled for deduction. Acco ..... X X X X Extracts X X X X X X X X Extracts X X X X
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