The Bangalore bench of the Tribunal, while dismissing an appeal filed by the income tax department against Vyshya Bank held that the provisions of book profit under section 115 JB of the Income Tax Act, 1961 shall not be applicable to a banking company.
The assessee challenged the confirmation of addition of the write off of non-convertible debentures, depreciation on investment, depreciation on leased assets and provision for NPA while arriving at the book profits under section 115JB of the Act. The main ground of appeal filed by the assessee was that the provisions of sec.115JB are not applicable to the assessee, being a bank.
The Two-judge bench of the Tribunal comprising Accountant Member Mr. Jason P Boaz and Judicial Member Ms. P Madhavi Devi relied on a catena of precedents wherein it has been held that the provisions of sec.115JB are not applicable to a banking company.
Having regard to the material on record and the judicial precedents thereon, we are inclined to agree with the learned counsel for the assessee that the provisions of sec.115JB are not applicable to a banking company. The decisions relied on by the learned counsel for the assessee in the case of Canara Bank, Dena Bank and ICICI Lombard General Insurance Co. Ltd., have taken this view and respectfully following the decisions of the coordinate benches, we hold that the provisions of sec.115JB are not applicable to a banking company i.e. the assessee herein also. Having held that the provisions of sec.115JB are not applicable to the assessee, we are of the opinion that grounds No.19 to 22 need no adjudication at this stage.
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