Case Law Details
Canara Bank Vs DCIT (ITAT Bangalore)
ITAT Bangalore held that assessee is eligible to avail deduction of an amount representing actual write off in the books of account of bad debts relating to nonrural/urban advances in terms with section 36(1)(vii), as proviso to the said section would not apply to non-rural advances.
Facts- The assessee filed its return of income on 28.11.2016 declaring total income of Rs.101,07,97,040. The case was selected for scrutiny and assessment u/s. 143(3) was completed on 27.03.2018 assessing total income at Rs.675,71,81,077/- under the regular provisions of the Act and deemed total income of Rs.696,42,91,164/- under the MAT provisions. The assessee filed appeal before the CIT(Appeals) which was partly allowed. Aggrieved, the assessee is in appeal before the Tribunal.
Conclusion- Held that assessee would be eligible to avail deduction of an amount representing actual write off in the books of account of bad debts relating to nonrural/urban advances in terms with section 36(1)(vii), as proviso to the said section would not apply to non-rural advances. Accordingly, we delete the addition made by AO and confirmed by ld. CIT(A).
Held that the while calculating average aggregate advances of rural branches under section 36(1)(viia), both advance outstanding as well as fresh advances are to be considered.
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