UNION BANK OF INDIA, MUMBAI v. DCIT LTU, MUMBAI

ITA 6981/MUM/2013 | 1991-1992
Pronouncement Date: 31-07-2015 | Result: Allowed

Appeal Details

RSA Number 698119914 RSA 2013
Assessee PAN AAACU0564G
Bench Mumbai
Appeal Number ITA 6981/MUM/2013
Duration Of Justice 1 year(s) 8 month(s) 1 day(s)
Appellant UNION BANK OF INDIA, MUMBAI
Respondent DCIT LTU, MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 31-07-2015
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted F
Tribunal Order Date 31-07-2015
Assessment Year 1991-1992
Appeal Filed On 29-11-2013
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL F BENCH MUMBAI BEFORE MS. SUSHMA CH O WLA JUDICIAL MEMBER AND SHRI N.K . BILLAIYA A CCOUNTANT M EMBER / I .T.A. NO. 6981/MUM/2013 ( / ASSESSMENT YEAR : 1991 - 92 UNION BANK OF INDIA CENTRAL ACCOUNTS DEPARTMENT VI FLOOR 239 VIDHAN BHAVAN MARG NARIMAN POINT MUMBAI - 400 021 / VS. THE DCIT - LTU 29 TH FLOOR WORLD TRADE CENTER CUFFE PARADE MUMBAI - 400 005 / I .T.A. NO. 6977/MUM/2013 ( / ASSESSMENT YEAR : 2004 - 05 UNION BANK OF INDIA CENTRAL ACCOUNTS DEPARTMENT VI FLOOR 239 VIDHAN BHAVAN MARG NARIMAN POINT MUMBAI - 400 021 / VS. THE ACIT - LTU 29 TH FLOOR WORLD TRADE CENTER CUFFE PARADE MUMBAI - 400 005 / I .T.A. NO. 691 9 /MUM/2013 ( / ASSESSMENT YEAR : 2004 - 05 THE ACIT - LTU 29 TH FLOOR WORLD TRADE CENTER CUFFE PARADE MUMBAI - 400 005 / VS. UNION BANK OF INDIA CENTRAL ACCOUNTS DEPARTMENT VI FLOOR 239 VIDHAN BHAVAN MARG NARIMAN POINT MUMBAI - 400 021 / I .T.A. NO. 69 78 /MUM/2013 ( / ASSESSMENT YEAR : 2005 - 06 UNION BANK OF INDIA CENTRAL ACCOUNTS DEPARTMENT VI FLOOR / VS. THE A CIT - LTU 29 TH FLOOR WORLD TRADE CENTER CUFFE PARADE UNION BANK OF INDIA 2 239 VIDHAN BHAVAN MARG NARIMAN POINT MUMBAI - 400 021 MUMBAI - 400 005 / I .T.A. NO. 69 20 /MUM/2013 ( / ASSESSMENT YEAR : 2005 - 06 THE DCIT - LTU 29 TH FLOOR WORLD TRADE CENTER CUFFE PARADE MUMBAI - 400 005 / VS. UNION BANK OF INDIA CENTRAL ACCOUNTS DEPARTMENT VI FLOOR 239 VIDHAN BHAVAN MARG NARIMAN POINT MUMBAI - 400 021 / I .T.A. NO . 69 79 /MUM/2013 ( / ASSESSMENT YEAR : 2006 - 07 UNION BANK OF INDIA CENTRAL ACCOUNTS DEPARTMENT VI FLOOR 239 VIDHAN BHAVAN MARG NARIMAN POINT MUMBAI - 400 021 / VS. THE DCIT - LTU 29 TH FLOOR WORLD TRADE CENTER CUFFE PARADE MUMBAI - 400 005 ./ ./ PAN/GIR NO. : AAACU 0564G ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY: SHRI G.M. DOSS / RESPONDENT BY : SHRI C. NARESH / DATE OF HEARING : 28 . 0 7 .2015 / DATE OF PRONOUNCEMENT : 31 .0 7 .2015 / O R D E R PER BENCH THE CAPTIONED APPEALS WERE HEARD TOGETHER AND ARE DISPOSED OF BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. UNION BANK OF INDIA 3 ITA NO. 6981/MUM/2013 A.Y. 1991 - 92 2. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A) - 24 MUMBAI DT. 14.8.2013 PERTAINING TO A.Y. 1991 - 92. 2. THE SOLE GRIEVANCE OF THE ASSESSEE IS THAT THE LD. CIT(A) ERRED IN DENYING INTEREST DUE TO THE ASSESSEE U/S. 244A OF THE ACT FOR THE TIME TAKEN FOR CURING THE DEFECTS IN TDS CERTIFICATE. 3. THE FACTS OF THE CASE ARE THAT THE CREDIT FOR THE TDS AMOUNTING TO RS. 47 19 73 313 WAS GIVEN TO THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION. HOWEV ER CREDIT OF RS. 88 07 960/ - WAS GIVEN ON 29.4.1998. IT IS THE CLAIM OF THE ASSESSEE THAT INTEREST ON TDS OF RS. 88 07 960/ - SHOULD BE GRANTED FROM APRIL 1991 INSTEAD OF APRIL 1998. 4. THE LD. CIT(A) DECLINED THE ALLOW THE GRIEVANCE OF THE ASSESSEE HOLDING THAT PROVISIONS OF SEC. 244(2) CLEARLY APPLY ON THE FACTS OF THE CASE BECAUSE THERE WAS DELAY IN CURING THE DEFECTS IN TDS CERTIFICATE. THEREFORE THE ASSESSEE IS NOT ENTITLED TO INTEREST U/S. 244A FOR THE PERIOD STARTING WITH 1.4.1991 AND ENDING WITH 31.3.1998. 5. AGGRIEVED BY THIS FINDING OF THE LD. CIT(A) THE ASSESSEE IS BEFORE US. 6. THE LD. COUNSEL FOR THE ASSESSEE REITERATED WHAT HAS BEEN CLAIMED BEFORE THE LOWER AUTHORITIES. STRONG RELIANCE WAS PLACED ON THE DECISION OF THE HONBLE HIGH COURT OF BOMBAY IN THE CASE OF LARSEN & TOUBRO IN INCOME TAX APPEAL (L) NO. 3013 OF 2009. IT IS THE SAY OF THE LD. COUNSEL THAT WHATEVER DEFECT WAS THERE IN THE TDS CERTIFICATE IS NOT ATTRIBUTABLE TO THE ASSESSEE BECAUSE THE TDS CERTIFICATE WAS ISSUED BY THE UNION BANK OF INDIA 4 RESERVE BANK OF INDIA AND VARIOUS OTHER GOVERNMENT AGENCIES THEREFORE PROVISIONS OF SEC. 24 4(2) DO NOT APPLY ON THE FACTS OF THE CASE. 7. PER CONTRA THE LD. DEPARTMENTAL REPRESENTATIVE STRONGLY SUPPORTED THE FINDINGS OF THE REVENUE AUTHORITIES. 8. WE HAVE GIVEN A THOUGHTFUL CONSIDERATION TO THE RIVAL SUBMISSIONS AND HAVE CAREFULLY PERUSED T HE ORDERS OF THE AUTHORITIES BELOW. THE UNDISPUTED FACTS ARE THAT THE TDS CERTIFICATES WERE SUBMITTED WITH THE RETURN OF INCOME. IT IS ALSO A FACT THAT THE TDS CERTIFICATE HAS BEEN ISSUED BY RESERVE BANK OF INDIA AND VARIOUS OTHER GOVERNMENT AGENCIES THE REFORE ANY DEFECT IN THE TDS CERTIFICATE CANNOT BE ATTRIBUTED TO THE ASSESSEE. FURTHER THE TAX DEDUCTED AT SOURCE BY THE DEDUCTORS HAVE BEEN DEPOSITED TO THE CREDIT OF THE GOVERNMENT THEREFORE ASSESSEE CANNOT BE DENIED INTEREST U/S. 244A OF THE ACT WHEN THE TAX WAS DEDUCTED AND DEPOSITED IN THE EXCHEQUER IN TIME SECTION 244A(2) IS NOT ATTRACTED. WE DRAW SUPPORT FROM THE DECISION OF THE HONBLE HIGH COURT OF BOMBAY IN THE CASE OF LARSEN & TOUBRO (SUPRA). WE ACCORDINGLY SET ASIDE THE FINDINGS OF THE LD . CIT(A) AND DIRECT THE AO TO ALLOW THE INTEREST FOR THE PERIOD 1.4.1991 TO 31.3.1998. 9. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. 10. ITA NOS. 6977/M/2013 & 6919/M/2013 ARE CROSS APPEALS BY THE ASSESSEE AND THE REVENUE AGAINST THE VERY SAME ORDER OF THE LD. CIT(A) - 24 MUMBAI DATED 14.8.2013 PERTAINING TO ASSESSMENT YEAR 2004 - 05. ITA NO. 6919/M/2012 - REVENUES APPEAL UNION BANK OF INDIA 5 11. THE SOLE GRIEVANCE OF THE REVENUE IS THAT THE LD. CIT(A) ERRED IN ALLOWING THE PAYMENT OF MICR CHARGES OF RS. 16 96 032/ - . 12. DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER NOTICED THAT TO VERIFY THE TDS PROVISIONS APPLICABLE ON PAYMENT OF VARIOUS CHARGES INFORMATION WAS CALLED FOR FROM THE ASSESSEE BY THE ITO ( TDS ) SURAT. ON VERI FICATION OF SUCH DETAILS IT WAS FOUND THAT THE ASSESSEE HAS MADE PAYMENT OF RS. 16 96 032/ - TOWARDS MICR CHARGES TO MICR CENTRE MANAGED BY THE SBI. THE AO FURTHER NOTICED THAT TAX ON PAYMENT OF SUCH CHARGES HAS NOT BEEN DEDUCTED AT SOURCE AS WAS REQUIRED U/S. 194J OF THE ACT. IT WAS EXPLAINED THAT THE BANK WAS NOT REQUIRED TO DEDUCT TAX FROM THE PAYMENTS MADE TO SBI AND THEREFORE PROVISIONS OF SEC. 40(A)(IA) ARE NOT ATTRACTED. THE EXPLANATION OF THE ASSESSEE WAS NOT ACCEPTED BY THE AO AND ACCORDINGLY DI SALLOWED THE AMOUNT OF RS. 16 96 032/ - 13. THE ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) AND REITERATED ITS STAND. IT WAS BROUGHT TO THE NOTICE OF THE LD. CIT(A) THAT SBI HAS CONFIRMED THAT THE SAID AMOUNT RECEIVED BY IT WAS DULY ACCOUNTED FOR IN ITS TAX COMPUTATION. THE LD. CIT(A) WAS CONVINCED THAT THE RATIO LAID DOWN BY THE HONBLE SUPREME COURT IN THE CASE OF HINDUSTAN COCO COLA VS CIT 293 ITR 226 SQUARELY APPLY ON THE FACTS OF THE CASE AND ACCORDINGLY DELETED THE SAID DISALLOWANCE. 14. AG GRIEVED BY THIS THE REVENUE IS BEFORE US. 15. THE LD. DR STRONGLY SUPPORTED THE ASSESSMENT ORDER. 16. PER CONTRA THE LD. COUNSEL FOR THE ASSESSEE REITERATED WHAT HAS BEEN STATED BEFORE THE FIRST APPELLATE AUTHORITY. THE LD. COUNSEL ALSO UNION BANK OF INDIA 6 DREW OUR AT TENTION TO THE ORDER MADE U/S. 201(1) AND 201(1A) OF THE ACT WHEREIN THE AO HAS ADMITTED THAT THE STATE BANK OF INDIA HAS CONFIRMED THAT MICR CHARGES WERE DULY ACCOUNTED WHILE MAKING TAX PAYMENT BY SBI. HOWEVER FOR NON DEPOSIT OF TAX WITHIN THE PRESCRIBE D TIME LIMIT THE ASSESSEE WAS ASKED TO PAY INTEREST. 17. WE HAVE CAREFULLY PERUSED THE ORDERS OF THE AUTHORITIES BELOW. WE HAVE ALSO THE BENEFIT OF THE ORDER MADE U/S. 201 (1) & 201(1A) OF THE ACT DATED 23.3.2011. WE HAVE ALSO THE BENEFIT OF THE COP Y OF NOTIFICATION NO. 56/2012(F.NO. 275/53/2012 - IT(B) DATED 31.3.2012 WHEREIN THE CBDT HAS NOTIFIED THAT NO DEDUCTION OF TAX UNDER CHAPTER XVII OF THE SAID ACT SHALL BE MADE ON THE PAYMENTS BEING CLEARANCE CHARGES (MICR CHARGES). IN OUR CONSIDERED OPINI ON SINCE IT HAS BEEN ADMITTEDLY PROVE D THAT THE RECIPIENT OF THE MICR CHARGES I.E. STATE BANK OF INDIA HAS INCLUDED THE SUM WHILE MAKING TAX PAYMENT BY IT . THE RATIO LAID DOWN BY THE HONBLE SUPREME COURT IN THE CASE OF HINDUSTAN COCO COLA (SUPRA) SQUAR ELY APPLY. CONSIDERING THE FACTS IN TOTALITY AS MENTIONED ABOVE WE DECLINE TO INTERFERE WITH THE FINDINGS OF THE LD. CIT(A). 18. IN THE RESULT THE APPEAL FILED BY THE REVENUE IS DISMISSED. ITA NO. 6977/M/13 A.Y. 2004 - 05 - CROSS APPEAL 1 9 . THE ASSESSEE HAS CHALLENGED THE REOPENING OF THE ASSESSMENT. AS WE HAVE DISMISSED REVENUES APPEAL IN ITA NO. 6977/M/2013 ON MERIT WE DO NOT FIND IT NECESSARY TO DECIDE ASSESSEES APPEAL ON THE POINT OF LAW. 20. ITA NO.6978/MUM/2013 & ITA NO. 6920 FOR A.Y. 2005 - 06 ARE CROSS APPEALS BY THE ASSESSEE AND THE REVENUE AGAINST THE VERY SAME UNION BANK OF INDIA 7 ORDER OF THE LD. CIT(A) - 24 MUMBAI DT. 14.8.2013 PERTAINING TO A.Y. 2005 - 06. ITA NO. 6978/M/2013 A.Y. 2005 - 06 - ASSESSEES APPEAL 21. THE SOLE GRI EVANCE OF THE ASSESSEE IS THAT THE LD. CIT(A) IS NOT JUSTIFIED IN CONFIRMING THE EXPENDITURE OF RS. 26.13 CRORES U/S. 14A BEING THE AMOUNT OF INTEREST ALLOCATED ON A PROPORTIONATE BASIS. 22. IN THE FIRST ROUND OF LITIGATION THE DISALLOWANCE MADE BY THE AO U/S. 14A READ WITH RULE 8D TRAVELLED UPTO THE TRIBUNAL AND THE TRIBUNAL IN ITA NO S. 4702 TO 4706/M/2010 FOR A.YRS 2002 - 03 TO 2006 - 07 AT PARA - 5 OF ITS ORDER HAS RESTORED THE MATTER TO THE FILE OF THE AO FOR DECIDING THE QUANTUM OF DISALLOWANCE ON SOME REASONABLE BASIS AND NOT AS PER RULE 8D. HOWEVER WHILE GIVING EFFECT TO THE ORDER OF THE TRIBUNAL THE AO ONCE AGAIN COMPUTED THE DISALLOWANCE HOLDING THAT THE FORMULA GIVEN IN RULE 8D GIVES A REASONABLE BASIS OF DISALLOWANCE OF EXPENDITURE INCURRED FO R EARNING EXEMPT INCOME. 23. THE ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) BUT WITHOUT ANY SUCCESS. 24. BEFORE US THE LD. COUNSEL FOR THE ASSESSEE VEHEMENTLY SUBMITTED THAT ONCE THE INTEREST FREE FUNDS OF THE ASSESSEE ARE CONSIDERED QUA THE AVE RAGE INVESTMENTS IN ASSETS EARN ING TAX FREE INCOME I T WOULD BE CLEAR THAT THE ASSESSEE IS HAVING SUFFICIENT OWN FUNDS FOR MAKING THE INVESTMENTS THEREFORE THE RATIO LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN THE CASE OF HDFC BANK IN 366 ITR 505 SQUAREL Y APPLY. THEREFORE THERE CANNOT BE ANY ALLOCATION OF INTEREST IN SO FAR AS THE COMPUTATION OF DISALLOWANCE IS CONCERNED. THE LD. COUNSEL ALSO PLACED UNION BANK OF INDIA 8 RELIANCE UPON THE DECISION OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR A.YRS. 2002 - 03 TO 2004 - 05 IN ITA N OS. 6982 TO 6984/M/ 2013. 25. THE DR RELIED UPON THE FINDINGS OF THE AO. 26. WE HAVE CAREFULLY PERUSED THE ORDERS OF THE AUTHORITIES BELOW. UNDOUBTEDLY IN THE FIRST ROUND OF LITIGATION THE TRIBUNAL HAS CLEARLY HELD THAT RULE 8D IS NOT APPLICABLE FOR THE YEAR UNDER CONSIDERATION THEREFORE DIRECTED THE AO TO MAKE SOME REASONABLE DISALLOWANCE. HOWEVER WE FIND THAT THE AO HAS ONCE AGAIN COMPUTED THE DISALLOWANCE AS PER THE FORMULA GIVEN IN RULE 8D. WE ALSO FIND THAT THE INTEREST FREE FUNDS AVAILABLE WITH THE ASSESSEE IS RS. 1357.84 CRORES WHEREAS AVERAGE INVESTMENTS IN ASSETS EARNING TAX FREE INCOME IS AT RS. 815.76 CRORES. THIS CLEARLY SHOWS THAT THE ASSESSEE IS HAVING SUFFICIENT INTEREST FREE FUNDS FOR MAKING THE INVESTMENTS. THE RATIO LAID DOWN B Y THE HONBLE HIGH COURT OF BOMBAY IN THE CASE OF RELIANCE UTILITIES AND POWER LTD 313 ITR 340 SQUARELY APPLY WHICH HAS BEEN FOLLOWED BY THE HONBLE HIGH COURT OF BOMBAY IN THE CASE OF HDFC BANK (SUPRA) WHICH HAS BEEN FOLLOWED BY THE TRIBUNAL IN ASSESSEES OWN CASE IN A.Y. 2002 - 03 TO 2004 - 05 IN ITA NOS. 6982 TO 6984/M/13. RESPECTFULLY FOLLOWING THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT AND THE COORDINATE BENCH WE DIRECT THE AO TO DELETE THE IMPUGNED DISALLOWANCE MADE U/S. 14A OF THE ACT. 27. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ITA NO. 6920/MUM/2013 A.Y. 2005 - 06 REVENUES APPEAL 28. THE FIRST GRIEVANCE OF THE REVENUE IS THAT THE LD. CIT(A) ERRED IN ALLOWING DEDUCTION U/S. 36(1)(VIIA) OF THE I.T. ACT. UNION BANK OF INDIA 9 29. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT WHILE GIVING EFFECT TO THE ORDER OF THE TRIBUNAL THE AO BY HIS ORDER DATED 5.1.2012 DID NOT ALLOW DEDUCTION U/S. 36(1)(VIIA) OF THE ACT BASED ON THE AMOUNT ELIGIBLE AT 7.5% OF GROSS TOTAL INCOME AND 10% OF RURAL ADVANCES AND RESTRICTED THE DEDUCTION TO THE QUANTUM OF PROVISION MADE IN THE BOOKS TOWARDS BAD AND DOUBTFUL DEBTS. 29.1. BEFORE THE LD. CIT(A) IT WAS STRONGLY CONTENDED THAT AS PER THE PROVISIONS OF SEC. 36(1)(VIIA) THE DEDUCTION IS ALLOWABLE IN RESPECT OF ANY PROVISIONS MADE FOR BAD AND DOUBTFUL DEBTS. THE ASSESSEE STRONGLY CONTENDED THAT THE ACT DOES NOT PROVIDE FOR RES TRICTING THE DEDUCTION TO THE EXTENT OF PROVISION MADE IN BOOKS THEREFORE THE DEDUCTION SHOULD NOT HAVE BEEN RESTRICTED TO THE EXTENT OF PROVISION MADE IN THE BOOKS. AFTER CONSIDERING THE FACTS IN THE LIGHT OF THE PROVISIONS OF SEC. 36(1)(VIIA) THE LD . CIT(A) FOLLOWED THE DECISION OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR A.Y. 2007 - 08 AND ALLOWED THE CLAIM OF THE ASSESSEE. 30. BEFORE US THE REVENUE STRONGLY RELIED UPON THE FINDING OF THE LD. AO AND THE LD. COUNSEL FOR THE ASSESSEE REITERATED WHAT H AS BEEN STATED BEFORE THE FIRST APPELLATE AUTHORITY. ONCE AGAIN RELIANCE WAS PLACED ON THE DECISION OF THE TRIBUNAL IN ITA NOS. 6631/M/2010 AND 6349/M/10 FOR A.Y. 2007 - 08 . 31. WE HAVE CAREFULLY PERUSED THE ORDERS OF THE AUTHORITIES BELOW AND THE DECISION OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR A.Y. 2007 - 08. THE TRIBUNAL HAS CONSIDERED THIS ISSUE AT PARA - 39 OF ITS ORDER AND AT PARA - 42 THE TRIBUNAL HAS HELD THAT THE ASSESSEE IS ENTITLED TO A DEDUCTION WHICH IS QUANTIFIED NOT WITH REFERENCE TO THE AMOU NT PROVIDED FOR IN THE UNION BANK OF INDIA 10 ACCOUNT BUT WITH RESPECT TO CERTAIN PERCENTAGE OF THE TOTAL INCOME AND ALSO CERTAIN PERCENTAGE OF AGGREGATE ADVANCES. 31.1. WITH OUR UTMOST RESPECT TO THE AFOREMENTIONED DECISION OF THE CO - ORDINATE BENCH WE HAVE TO SAY THAT THE DECISION OF THE HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF STATE BANK OF PATIALA 272 ITR 54 WAS NEITHER BROUGHT TO THE NOTICE OF THE TRIBUNAL NOR IT WAS CONSIDERED BY THE TRIBUNAL. ON IDENTICAL SET OF FACTS THE HONBLE PUNJAB & HARYANA HIGH COURT AFTER CONSIDERING THE FOLLOWING FACTS HAS HELD ACCORDINGLY : - T HE DEDUCTION ALLOWABLE UNDER SECTION 36(1)(VIIA) OF THE INCOME - TAX ACT 1961 IS IN RESPECT OF THE PROVISION MADE. THEREFORE MAKING OF A PROVISION FOR BAD AND DOUBTFUL DEBT EQUAL TO THE AMOUNT MENTIONED IN THIS SECTION IS A MUST FOR CLAIMING SUCH DEDUCTION. THE PROVISO TO CLAUSE (VII) OF SECTION 36(1) ALSO SHOWS THAT MAKING OF PROVISION EQUAL T O THE AMOUNT CLAIMED AS DEDUCTION IN THE ACCOUNT BOOKS IS NECESSARY FOR CLAIMING DEDUCTION UNDER SECTION 36(1)(VIIA). BEFORE THE FINALISATION OF THE BALANCE - SHEET FOR THE ASSESSMENT YEAR 1985 - 86 THE ASSESSEE CLAIMED THE DEDUCTION UNDER THE UNAMENDED SECTION 36(1)(VIIA) BUT AFTER THE FINALISATION AND IN VIEW OF THE AMENDMENT MADE IN THAT SECTION WITH RETROSPECTIVE EFFECT F ROM APRIL 1 1985 IT ENHANCED THE CLAIM FOR DEDUCTION FROM RS. 1 19 36 000 TO RS. 1 94 21 000 IN ITS RETURN OF INCOME BUT ACCORDINGLY MADE UP THE SHORTFALL IN THE PROVISION IN THE BALANCE - SHEET OF THE SUBSEQUENT YEAR. THE ASSESSEE CONTENDED BEFORE THE ASS ESSING OFFICER THAT THIS WAS SUBSTANTIAL COMPLIANCE WITH THE REQUIREMENT OF LAW BUT THE ASSESSING OFFICER RESTRICTED THE CLAIM FOR DEDUCTION FOR BAD DEBTS TO RS. 1 19 36 000 ON THE GROUND THAT IN THE BOOKS OF ACCOUNT PERTAINING TO THE RELEVANT ASSESSMENT YEAR THE ASSESSEE HAD MADE PROVISION FOR BAD DEBTS AT RS. 1 19 36 000 ONLY. THE DISALLOWANCE WAS UPHELD BY THE COMMISSIONER (APPEALS) AND THE TRIBUNAL. ON APPEAL : HELD ACCORDINGLY THAT THE ASSESSEE HAD NOT MADE ANY PROVISION IN THE BOOKS OF ACCOUNT FOR THE ASSESSMENT YEAR 1985 - 86 BY MAKING SUPPLEMENTARY ENTRIES AND BY REVISING ITS BALANCE - SHEET. THE PROVISION HAD BEEN MADE IN THE BOOKS OF THE SUBSEQUENT YEAR. THEREFORE THE TRIBUNAL WAS RIGHT IN HOLDING THAT SINCE THE ASSESSEE HAD MADE A PROVISION OF RS . UNION BANK OF INDIA 11 1 19 36 000 FOR BAD AND DOUBTFUL DEBTS ITS CLAIM FOR DEDUCTION UNDER SECTION 36(1)(VIIA) HAD TO BE RESTRICTED TO THAT AMOUNT. NO SUBSTANTIAL QUESTION OF LAW AROSE FOR CONSIDERATION OF THE COURT IN THE APPEAL . RESPECTFULLY FOLLOWING THE DECISION OF THE HONBLE PUNJAB & HARYANA HIGH COURT (SUPRA) WE SET ASIDE THE FINDINGS OF THE LD. CIT(A) AND CONFIRM THAT OF THE AO. GROUND NO. 1 IS ACCORDINGLY ALLOWED. 32. GROUND NO. 2 RELATES TO THE GRIEVANCE THAT THE LD. CIT(A) ERRED IN HOLDING THAT THE PROVISI ON OF SEC. 115JB OF I.T. ACT ARE NOT APPLICABLE TO THE ASSESSEE. 33. THE LD. DR FAIRLY CONCEDED THAT THIS ISSUE HAS ALREADY BEEN DECIDED IN ASSESSEES OWN CASE FOR A.Y. 2007 - 08. 34. WE HAVE CAREFULLY PERUSED THE ORDER OF THE TRIBUNAL IN ITA NOS. 6631/M/2010 AND 6349/M/10 FOR A.Y. 2007 - 08. THE TRIBUNAL HAS CONSIDERED THIS ISSUE AT PARA - 19 OF ITS ORDER QUA GROUND NO. 4 OF THAT APPEAL AND AT PARA - 22 THE TRIBUNAL HAS HELD AS UNDER: T HUS RESPECTFULLY FOLLOWING THE EARLIER YEARS PRECEDENCE WE HOLD THAT THE PROVISIONS OF SEC. 115JB ARE NOT APPLICABLE IN THE CASE OF THE ASSESSEE AND ACCORDINGLY GROUND TAKEN BY THE ASSESSEE IS ALLOWED. RESPECTFULLY FOLLOWING THE FINDINGS OF THE CO - OR DINATE BENCH GROUND NO. 2 IS DISMISSED. 35. IN THE RESULT THE APPEAL FILED BY THE REVENUE IS PARTLY ALLOWED. ITA NO. 6979/M/2013 A.Y. 2006 - 07 ASSESSEES APPEAL. UNION BANK OF INDIA 12 36. THIS APPEAL BY THE ASSESSEE IS PREFERRED AGAINST THE ORDER OF THE LD. CIT(A) - 24 MUMBAI DT. 14.8.2013. 37. THE FIRST GRIEVANCE OF THE ASSESSEE RELATES TO THE DISALLOWANCE OF EXPENDITURE U/S. 14A BEING THE INTEREST ALLOCATED ON A PROPORTIONATE BASIS. 37.1. AN IDENTICAL ISSUE HAS BEEN CONSIDERED BY US IN ITA NO.6978/M/13 FOR A.Y. 2005 - 06. FOR THE SAME SET OF FACTS WE HOLD ACCORDINGLY. GROUND NO. 1 IS ALLOWED. 38. THE SECOND GROUND RELATES TO DENYING INTEREST DUE TO THE ASSESSEE U/S. 244A OF THE ACT. 38.1. AN IDENTICAL ISSUE HAS BEEN CONSIDERED BY US IN ITA NO. 6981/M/13 FOR A.Y. 1991 - 92 ON THE SAME SET OF FACTS WE HOLD ACCORDINGLY. GROUND NO. 2 IS ALLOWED. APPEAL FILED BY THE ASSESSEE IS ALLOWED. 39. IN THE RESULT THE APPEALS FILED BY THE ASSESSEE IN ITA NO. 6981 6978 6979 /M/13 ARE ALLOWED AND ITA NO. 6977/M/13 ARE DISMISSED AND THE APPEALS FILED BY THE REVENUE IN ITA NO. 6920/M/13 IS PARTLY ALLOWED & ITA NO. 6919/M/13 IS DISMISSED . OR DER PRONOUNCED IN THE OPEN COURT ON 31 ST JU LY 2015 SD/ - SD/ - ( SUSHMA CH O WLA ) (N.K. BILLAIYA) /JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED : 31 ST JU LY 2015 . . ./ RJ SR. PS UNION BANK OF INDIA 13 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. / DR ITAT MUMBAI 6. / GUARD FILE . / BY ORDER //TRUE COPY// / (DY./ASSTT. REGISTRAR) / ITAT MUMBAI