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TMI Blog2019 (4) TMI 824X X X X Extracts X X X X X X X X Extracts X X X X ..... ank of India. As we can see, the assessee case is covered by Jurisdictional High Court in the matter of Pr.CIT vs. Shri Mahila Sewa Sahakari Bank Ltd. [2016 (8) TMI 377 - GUJARAT HIGH COURT] wherein it has been held that “ Non Performing Asssets – CANNOT BE RECOGNISED ON ACCRUAL BASIS – ASSESSEE BOUND BY RESERVE BANK OF INDIA GUIDELINES” and income from Non Performing Asset is not recognized on accrual basis but is booked as income only when it is actually received. Therefore bank should not take to income account, interest on Non Performing Assets on accrual basis. Respectfully following the above said judgment, we allow this ground of appeal. Disallowance of Investment Depreciation Reserve - HELD THAT:- As relying on M/S. GAJANA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aw and or on facts in not considering fully and properly the submissions made and evidence produced by the appellant with regard to the impugned additions. 2.1 The Ld.CIT(A) has grievously erred in law and on facts in confirming that the interest of ₹ 25,00,752/- on NPAs provided by the appellant bank in accordance with the guidelines of RBI and recognized accounting practice had accrued and chargeable to tax. The Ld. CIT(A) has failed to appreciate that there being no real income or actual receipts, the impugned interest was not liable to tax. 2.2 That in the facts and circumstances of the case as well as in law, the Ld.CIT(A) ought not to have upheld that the interest of ₹ 25,00,752/- on NPAs had accrued and accordin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; 10,75,880/-. 5. We have gone through the relevant record and impugned order. Appellant is co-op bank registered under the Gujarat Co-Op Society Act and carrying on banking business as per Reserve Bank of India guidelines. 6. The appellant has furnished the complete list of Non Performing Assets as per RBI Guidelines and also furnished the details of interest accrued on such NPAs during the Financial Year 2010-11 which aggregated to ₹ 25,00,752/- and same was not charged as mandatorily stipulated under income recognition and Assets classification norms of Reserve Bank of India. 7. As we can see, the assessee case is covered by Jurisdictional High Court in the matter of Pr.CIT vs. Shri Mahila Sewa Sahakari Bank Ltd. wherein i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to deducted on account of depreciation of security held as an investment in Government security-Held, In appeal before Appellate Tribunal, it held that securities were stock in trade and so depreciation would amount to loss and not income-Authorities below held that this aspect was well settled through judgment of High Court in the case of Commissioner of Income Tax vs. Bank of Baroda, as well as in judgment of Supreme Court in case of UCO Bank vs. the Commissioner of Income Tax- Supreme Court in said judgment held that merely because securities were kept under head by bank till maturity, said security could not be treated as purely investment.-Security held by bank was in nature of stock in trade-Reliance placed by Revenue on judgment o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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