income recognition

[JB]

Friends,

I have a query. There was an old board circular dated 09-10-1984 prescribing income recognition on NPA in case of banks. The same was referred to by the Supreme Court in case of Uco Bank (237 ITR 889). Whether that circular is in effect today or it has been withdrawn later on? I feel it has been withdrawn as section 43D was enacted later on to take care of this aspect. Can any body provide me the relevant material or subsequent circular withdrawing the said circular dated 09-10-1984? Thanks in advance.

[pawansingla]

IT : Interest on bad debts - Interest on bad and doubtful debts kept in reserve account would be eligible for deduction under section 43D

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[2012] 25 taxmann.com 572 (Mumbai - Trib.)
IN THE ITAT MUMBAI BENCH 'L'

American Express Bank Ltd.

v.

Additional Commissioner of Income-tax, Spl. Range-32, Mumbai*

R.S. SYAL, ACCOUNTANT MEMBER
AND I.P. BANSAL, JUDICIAL MEMBER
IT APPEAL NO. 5374 (MUM.) OF 2001
INT. T.A. NO. 97 (MUM.) OF 2001
[ASSESSMENT YEAR 1998-99]
AUGUST 10, 2012
Section 43D of the Income-tax Act, 1961 - Public Financial institution/public companies - Assessment year 1998-99 - Whether mere crediting of interest to a reserve cannot be said to be an incidence by which said interest could be charged to tax - Held, yes - Whether where interest on loans granted by assessee-bank remained unpaid which were classified as non-accrual loans and were reversed to an account called Reserve for Doubtful Interest account, assessee would be entitled to claim deduction under section 43D in respect of said interest and simply on ground that interest had been credited on such type of debts in reserve account, deduction could not be taken away - Held, yes [Para 15] [In favour of assessee]

Section 5 of the Interest-tax Act, 1974 read with section 43D of the Income-tax Act, 1961 - Chargeable interest - Assessment year 1998-99 - Whether interest on non-performing assets would be charged to interest-tax only in year in which said interest is credited to profit and loss account or in year of receipt, whichever is earlier - Held, yes [Para 17] [In favour of assessee]

[Krishna]

Dear members,

I have a income tax capital gains tax case. I am looking for a good lawyer, who can represent my case in the high court of Karnataka.

Any pointers in this direction will be highly appreciated. Preferably someone who has already represented such cases successfully in the court.


Regards,
Krishna