Asstt. Commissioner of Income Tax v/s Chandrapur District Central Co-operative Bank

Parties Involved

Facts Summary

The assessee, a District Central Co-operative Bank, filed its return of income declaring a total loss of ` (–) 51,65,50,638 for the year under consideration. The Assessing Officer found that the assessee had debited a sum of ` 2 crore towards provisions on bad and doubtful loans, whereas the assessee claimed a deduction on account of bad and doubtful debt under section 36(1)(viia) of the Act amounting to ` 64,92,08,209. The Assessing Officer restricted the claim of allowable deduction under section 36(1)(viia) of the Act to ` 2 crore, resulting in an addition of ` 62.92 crore and a penalty of ` 21.40 crore levied under section 271(1)(c) of the Act. The assessee filed an appeal before the first appellate authority, which was dismissed by the learned Commissioner of Income Tax (Appeals). The Revenue then filed an appeal before the Tribunal.…

Legal Issues

• 1. Whether the learned CIT(A) was justified in ignoring the disallowance of the claim of deduction u/s 36(1)(viia) in earlier assessment years.
• 2. Whether the learned CIT(A) was justified in deleting the penalty levied u/s 271(1)(c) of the Act.

Judgment Outcome

Decided in favour of Revenue.

Precedents Relied Upon

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