Loss to banks on security classification from one to another category as per RBI directions is allowable expenditure

Brief of the Case ITAT Delhi held In the case of Oriental Bank of Commerce vs. ACIT that any loss arising to banks on account of classification of securities form one category to another category in compliance with RBI directions is an allowable expense. Financial institutions like banks are expected to maintain accounts in terms of the RBI Act and its regulations. The form in which, accounts have to be maintained is prescribed under the aforesaid legislation. Therefore, the account had to be in conformity with the said requirements. Facts of the Case Claim of Bad debts (Additional ground) The...