DCIT Vs Central Bank of India (ITAT Mumbai)
Mumbai ITAT Confirms Deletion of ₹305.49 Cr Penalty—MAT u/s 115JB Not Applicable to Nationalised Banks:
Mumbai Tribunal dealt with Revenue’s challenge against deletion of a massive penalty of ₹305,49,63,285/- levied u/s 271(1)(c). The penalty was based on AO’s treatment of bad debts written off of ₹14,31,45,93,495/- in the computation of book profit u/s 115JB (MAT).
CIT(A) had deleted the penalty relying on the Tribunal’s Special Bench ruling in Union Bank of India (ITA 3740/Mum/2018, order dated 06-09-2024), which held that MAT u/s 115JB does not apply to “corresponding new banks” constituted under the Banking Companies (Acquisition & Transfer of Undertakings) Act, 1970. The Assessee’s own case for AY 2013-14 had already been covered by this Special Bench verdict, and the Co-ordinate Bench in consolidated order dated 22-08-2025 (ITA 1054/Mum/2018 etc.) reaffirmed that s.115JB is not applicable to the Central Bank of India.
Revenue contended that it has already appealed the Special Bench decision before the High Court and filed the present appeal for consistency. However, the Tribunal noted that the legal issue is no longer res integra: the Special Bench decision squarely covers the Assessee, and subsequent Co-ordinate Bench orders for AY 2016-17 already applied the same ratio mutatis mutandis.
