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TMI Blog2019 (4) TMI 268X X X X Extracts X X X X X X X X Extracts X X X X ..... d of calculating accrued interest is followed by the assessee and the banks. As submitted by AR, if there is difference in methodology, there bound to be difference between the interest income calculated by the assessee and that credited to account of the Fixed Deposits by the bank. A.R rightly submitted that the said difference would get neutralized upon maturity of fixed deposit. Though the provisions of Section 37BA provide for giving credit for TDS only in the assessment year for which such income is assessable, the said provisions also provide for spreading of TDS credit, i.e., giving credit of TDS amount over the years during which the relevant income is offered. In the interest income, according to the assessee, the difference ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2009-10 to 2013-14 and this, in our view, will put this issue at rest. - Appeal of assessee is treated as allowed for statistical purposes. - ITA No. 718/Mum/2018 - - - Dated:- 8-3-2019 - Shri B.R. Baskaran, Accountant Member And Shri Ravish Sood, Judicial Member For the Appellant : Shri Jitendra Sanghavi For the Respondent : Shri D.G. Pansari, Sr.AR-CIT ORDER PER B.R. BASKARAN, ACCOUNTANT MEMBER: The assessee has filed this appeal, challenging the order dated 13-11-2017 passed by the Ld. Commissioner of Income Tax (Appeals)-6, Mumbai and it relates to AY. 2014-15. 2. The assessee is aggrieved by the decision of the Ld. CIT(A) in confirming the addition made to interest income made by the AO on account of d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ifference in interest income from FY. 2009-10 to FY. 2013-14. From the table, which is extracted in page 2 of assessment order, it can be noticed that the interest income shown by the assessee was more than that shown in Form 26AS in some years. Similarly, in some of the years, it was in other way. The cumulative effect of difference in all the five years worked out to shortage of ₹ 1,18,734/-. The assessee agreed to offer the same its income. However, AO took the view that TDS credit shall be given in the assessment year in which such income is assessable as per Rule 37BA of the Income Tax Rules r.w.s. 199 of the Act. Since he is allowing TDS credit of ₹ 79,15,150/- during the year under consideration, the AO proposed to assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unted for interest income for the incomplete period, while the bank may be crediting the relevant interest income to the fixed deposit account of the assessee on completion of the quarter. This would result in shortage in the first year and excess in the second year. The Ld A.R further submitted that this kind of difference would get neutralized on the maturity of fixed deposit. Accordingly he submitted that the assessee has prepared a table for the financial years 2009-10 to 2013-14 and demonstrated that the net difference over the five years period was only ₹ 1,18,734/-. 7. On the contrary, Ld. DR submitted that the assessee is claiming TDS amount of ₹ 79.15 Lakhs which was deducted from the gross interest income of ₹ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, it is not a case of understating interest income, which would warrant making additions. Accordingly, if the methodology adopted by the assessee and the bank for providing accrued interest differs, then, it will be difficult to implement the provisions of Section 37BA as it cannot be said that the methodology adopted by the bank alone is correct one. 11. It was stated that the assessee is consistently following same methodology for accounting for accrued interest and the relevant computations are also certified by the statutory auditors. It is not the case of the AO that the assessee has kept unaccounted deposits with banks. In this kind of situation, in our view, if the AO is satisfied with the computation of accrued interest income m ..... X X X X Extracts X X X X X X X X Extracts X X X X
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