The Tribunal relying on the decision of co-ordinate in case of Ludhiana Central Co-op Bank Ltd. (ITA No. 526/Chd/2013) dt. 3 January 2017 wherein the Tribunal considering the decisions of High Court and Supreme Court and taking account of RBI guidelines and AS-9 and following the real income theory, held that the interest on NPA loans are to be taxed on receipt basis. (AY. 2012-13 ,2013-14).
DCIT v. Kangra Central Co-operative Bank Ltd.( 2018) 63 ITR 231) (Chd.)(Trib.)
S. 43D : Public financial institutions–Interest income on loans categorised as NPA/sticky loans–Taxable on receipt basis and not on accrual basis. [S. 145]