Allowing the appeal the Court held that the unreconciled entries in another branch account of the assessee could not be treated as its income. On the facts, the entries were made only for the purpose of maintaining system which was lying in the branch office or the head office and on no accounting principle could it be treated as income of the assessee once it had been shown as reserve fund and as and when accrued, it would be treated as income. It was only an assessment of accounts pursuant to the guidelines issued by the Reserve Bank of India. Order of Tribunal is seta side.
State Bank of Bikaner and Jaipur v. DCIT (2019) 415 ITR 193 (Raj.)(HC) Editorial : SLP is granted to the revenue CIT v. State Bank of Bikaner and Jaipur ( 2019) 413 ITR 319 (St) (SC)
S. 145 : Method of accounting-Bank-Guidelines of Reserve Bank of India-Unreconciled outstanding amounts in inter branch accounts transferred to reserves through profit and loss account-Amount not assessable as Income [ S.28(i), Banking Regulation Act, 1949]