Bank of Bahrain & Kuwait B.S.C. Vs DCIT (ITAT Mumbai)
ITAT Mumbai held that when the reserve/provisions created in the year where the assessee has increased the book profit u/s. 115JB of the Act, the assessee is entitled to reduce the amount withdrawn from such reserve if the same is credited to the P & L account in that year.
Facts- The assessee is a commercial bank headquartered at Bahrain and has two branches in India one at Mumbai and Hyderabad, which is engaged in the normal banking activities which includes financing of foreign trade and foreign exchange transaction. The assessee for the year un-der consideration had filed its return of income on 26.09.2009, declaring total income at Rs. Nil and booking profits u/s. 115JB at Rs.1,85,63,851/-. The assessee’s case was selected for scrutiny under CASS and notice u/s. 143(2) and 142(1) of the Act were duly issued and served upon the assessee.
AO passed the draft assessment order on 19.03.2013 u/s. 143(3) r.w.s. 144C(1) of the Act and subsequently the final assessment order u/s. 143(3) r.w.s. 144C(3) of the Act dated 23.04.2013, determining the total income at Rs.1,85,63,851/- to the book profits u/s. 115JB of the Act.
CIT(A) dismissed the ground of appeal raised by the assessee. Being aggrieved, the present appeal is filed.
