2018 (11) TMI 1784 - AT - Income Tax

MAT u/s. 115JB - Addition made on account of MAT proceedings - HELD THAT - As decided in own case 2016 (1) TMI 135 - ITAT KOLKATA provisions of section 115JB are not applicable in the case of the assessee bank and further held that the amendment brought in section 115JB read with Explanation 3 thereon by the Finance Act 2012 is applicable only with effect from Asst Year 2013-14 onwards in line with the Notes to Clauses of Finance Act 2012 . - Decided in favour of assessee. Disallowance of expenses - HELD THAT - Heard both and perused the material available on record. We find that the CIT(A) by following Rule of Consistency as followed in assessee s own case for AY 2011-12 deleted the addition. Disallowance made on account of ATM machine charges - HELD THAT - As decided in own case we find that the issuance of ATM Cum Debit Cards to the customers of the assessee bank is part of the business activity of the assessee and there is no enduring benefit to the assessee out of incurring this expenditure. CIT(A) had observed that in the past the department had been accepting this expenditure as a revenue expenditure and we find no change in facts and circumstances of the case for the year under appeal with regard to the impugned issue warranting the department to take Cl different stand. Though the principle of res judicata does not apply to income tax proceedings, in our opinion the principle of consistency cannot be given a go bye. Reliance in this regard is placed en the decision of the Hon'ble Apex Court in the case of Radhasaomi Satsang 1991 (11) TMI 2 - SUPREME COURT . Hence, we find no infirmity in the order of the Ld. CIT (A). Addition u/s 14A r.w.r. 8D - HELD THAT - We find that the CIT(A) correctly by placing reliance in the order of this Tribunal in assessee s own case for AY 2009-10 2016 (1) TMI 135 - ITAT KOLKATA deleted the disallowance made under Rule 8D(2)(ii) and confirmed the disallowance made under Rule 8D(2)(iii) - Decided against revenue

Summary

Issues Involved:
1. Deletion of addition made on account of MAT proceedings.
2. Deletion of disallowance of expenses.
3. Deletion of disallowance made on account of ATM machine charges.
4. Deletion of addition u/s 14A of the Income Tax Act, 1961.

Deletion of Addition Made on Account of MAT Proceedings:
The Appellate Tribunal heard both appeals by the Revenue against separate orders passed by CIT(A)-23 for AY 2010-11 & 2012-13. The issues raised in both appeals were similar, and with the parties' consent, both appeals were heard together. The first issue addressed was the deletion of addition made on account of MAT proceedings. The Tribunal found that the issue was covered by a previous order of the Tribunal in the assessee's own case for AY 2009-10. The Tribunal held that the provisions of section 115JB of the Act were not applicable to the assessee bank, and the amendment brought in by the Finance Act 2012 was only applicable from AY 2013-14 onwards. The Tribunal upheld the CIT(A)'s decision, and the Revenue's appeal on this issue was dismissed.

Deletion of Disallowance of Expenses:
The second issue involved the deletion of disallowance of expenses. The CIT(A) deleted the addition by following the Rule of Consistency as applied in the assessee's own case for AY 2011-12. The Tribunal found that the liability of the expenses pertained to previous years but crystallized during the year under consideration. The Tribunal, considering the consistency in accounting methods followed by the assessee, allowed the expenses. The Revenue's appeal on this issue was dismissed as no infirmity was found in the CIT(A)'s order.

Deletion of Disallowance Made on Account of ATM Machine Charges:
The third issue was related to the deletion of disallowance made on account of ATM machine charges. The CIT(A) followed a previous order of the Tribunal in the assessee's own case for AY 2011-12. The Tribunal held that the expenditure incurred towards debit cards was a revenue expenditure and not a capital expenditure. The Tribunal, respecting the principle of consistency, allowed the debit card expenses. Consequently, the Revenue's appeal on this issue was dismissed.

Deletion of Addition u/s 14A of the Income Tax Act:
The final issue involved the deletion of addition made under section 14A of the Income Tax Act, 1961. The CIT(A) deleted the disallowance made under Rule 8D(2)(ii) but confirmed the disallowance made under Rule 8D(2)(iii). The Tribunal upheld the CIT(A)'s decision based on the Tribunal's previous order in the assessee's own case for AY 2009-10. The Revenue's appeal on this issue was dismissed, and the Tribunal found no infirmity in the CIT(A)'s order. Ultimately, all grounds raised by the Revenue in both appeals were dismissed, and the appeals were dismissed in their entirety.