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TMI Blog2015 (10) TMI 929X X X X Extracts X X X X X X X X Extracts X X X X ..... f Tribunal holding that the assessee being a banking company, the RBI guidelines were binding on it and therefore, valuation of investment on the basis of RBI guidelines was justified. In view of the above, we find no infirmity in the order of the ld. CIT(A). The assessee's pattern of valuation of securities being in accordance with RBI directions cannot be interfered with. Our view is fortified by the judgement of Hon'ble Uttarakhand High Court in the case of CIT vs. Nainital Bank Ltd. (supra). Thus the order of the ld. CIT(A) on the issue of securities is upheld. - Decided against revenue. Disallowance of expenses claimed to have been paid to various clubs - CIT(A) deleted the addition - Held that:- Apropos club fee expenses, various ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 2000-01 respectively on account of valuation of closing stock of securities. (ii) deleting the disallowance of ₹ 1,21,131/- for A.Y. 1997-98, ₹ 1,12,227/- for A.Y. 1998-99, ₹ 2,51,819/- for A.Y. 1999-2000 and ₹ 87,740/- for A.Y. 2000-01 respectively made on account of expenses claimed to have been paid to various clubs. 3.1 Apropos, Ground No. 1 the ld. DR relied on the order of the AO. 3.2 The ld. Counsel for the assessee on the hand contends that the assessee apart of from the banking business, also purchase and sale the securities which are its stock in trade. The stock of shares and securities are valued at cost or market value whichever is lower. Till assessment year 1992-93 the method of valu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the scrip-wise method of valuation of securities made an addition of ₹ 40,39,47,845/- as per the discussion on page 10-12 of the order. In making such addition he adopted the value of opening stock as per the assessee which was on scrip basis, instead of substituting it by the global basis. 3.3 The ld. CIT(A) deleted the addition by following observations:- I have gone through the order, arguments and written submission of the appellant's A.R. The matter is fully covered by the appeal orders of ld. CIT(A) for preceding four years i.e. 1993-94, 1994-95, 1995-96, and 1996-97. I have also considered the mater in my appellate orders for the assessment years 2001-02 and 2002-03. The issue is exactly covered by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of shares and securities on scripwise basis but has changed the valuation of closing stock of shares and securities on global basis. This has resulted in double addition. In fact the assessee debit the depreciation in the valuation of stock of shares and securities in the profit and loss account by making provision for such amount. In AY 1997-98, additional provision of ₹ 12,56,000/- was made. In subsequent year part of the provision so made was withdrawn and included in the income as per the table given in para 5.2 page 5 of the order of CIT(A). Therefore also the addition made by the AO has resulted into multiple addition in different years. 4.1 As regards the Ground No. 2, the ld. DR relied on the order of the AO. 4.2 Apropo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... investments are those which banks intend to hold till maturity and current investments are those which banks intend to deal in i.e. buy and sell on a day-to-day basis. On this basis, banks should classify the existing investments in approved securities into the aforesaid two categories. It has been decided that to begin with banks should keep not more than 70 per cent of their investments in the permanent category the accounting year 1992-93. This ratio will have to be brought down to 50 per cent in due course. All subsequent purchases will also be required to be classified suitably. We have no objection to banks inter-changing the investments from one category to another with the prior authorization of the Board of Directors, in which case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t Financial Services (P) Ltd. vs. DCIT 87 (2003) ITD 298 (Del.) was taken into consideration and it was affirmed by the Hon'ble Uttrakhand High Court. In view of the above, we find no infirmity in the order of the ld. CIT(A). The assessee's pattern of valuation of securities being in accordance with RBI directions cannot be interfered with. Our view is fortified by the judgement of Hon'ble Uttarakhand High Court in the case of CIT vs. Nainital Bank Ltd. (supra). Thus the order of the ld. CIT(A) on the issue of securities is upheld. Hence, the Ground No. 1 of the Revenue in all the assessment years raised above are dismissed. 6.1 We have heard the rival contentions and perused the materials available on record. Apropos club ..... X X X X Extracts X X X X X X X X Extracts X X X X
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