Telangana Grameena Bank(Earlier Known as M/s Deccan Grameena Bank), Hyderabad V. Asst. Commissioner of Income Tax, Circle-9(1), Hyderabad

CO 25/Hyd/2018

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 9185 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 3 month(s) 6 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 04-10-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-A
• Next Hearing Date: 04-09-2019
• Assessment Year: 2009-2010
• Appeal Filed On: 28-06-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: LAXMINIWAS SHAR MA
• Assessee Lawyers: NIVEDITA BISWAS
• Keywords: TDS
• Section: 40(a)(ia); 148; 263

Judgement Text

ITA NOS 714 AND 485 AND ITS COS TELANGANA GRAMEENA BANK HYDERABAD. PAGE 1 OF 10 IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD A BENCH, HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ITA NOS.714 & 485/HYD/2018 ASSESSMENT YEARS:2008-09 & 2009-10 ASSTT. COMMISSIONER OF INCOME TAX, CIRCLE 9(1) HYDERABAD VS. TELANGANA GRAMEENA BANK, HYDERABAD PAN:AAAAD3893M (APPELLANT) (RESPONDENT) C.O.NOS.27 & 25/HYD/2018 (ARISING OUT OF ITA NOS.714 & 485/HYD/2018) ASSESSMENT YEARS:2008-09 & 2009-10 TELANGANA GRAMEENA BANK, HYDERABAD PAN:AAAAD3893M VS. ASSTT. COMMISSIONER OF INCOME TAX, CIRCLE 9(1) HYDERABAD (APPELLANT) (RESPONDENT) REVENUE BY: SMT. NIVEDITA BISWAS, DR REVENUE BY : SRI LAXMI NIWAS SHARMA DATE OF HEARING: 04/09/2019 DATE OF PRONOUNCEMENT: 04/10/2019 ORDER PER SMT. P. MADHAVI DEVI, J.M. THE ABOVE APPEALS ARE FILED BY THE REVENUE, WHILE T HE CROSS OBJECTIONS ARE FILED BY THE ASSESSEE FOR THE RESPECTIVE A.YS.I.E. 2008-09 AND 2009-10. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS A REGIONAL RURAL BANK PROMOTED BY THE STATE BANK GROU P, ENGAGED IN THE ACTIVITY OF BANKING. IT CAME INTO EXISTENCE ON 24.03.2006 DUE TO AMALGAMATION OF FOUR REGIONAL RURAL BANKS. T HE ASSESSEE ITA NOS 714 AND 485 AND ITS COS TELANGANA GRAMEENA BANK HYDERABAD. PAGE 2 OF 10 FILED A RETURN OF INCOME FOR THE A.Y 2008-09 ON 26. 09.2008. SUBSEQUENTLY, THE CASE WAS REOPENED BY ISSUANCE OF A NOTICE U/S 148 ON 27.03.2015, PURSUANT TO THE DIRECTIONS OF CI TS U/S 263 OF THE ACT, THAT THE INTEREST PAID ON DEPOSITS ATTRACT S TDS PROVISIONS AND IT WAS REQUIRED TO SEE WHETHER THE ASSESSEE HAS COMPLIED WITH THE TDS PROVISIONS OR NOT. ON VERIFICATION OF THE S UBMISSIONS OF THE ASSESSEE AND ALSO ON VERIFICATION OF THE ASSESS MENTS FOR THE A.YS 2010-11 AND 2011-12, THE AO OBSERVED THAT THE ASSESSEE HAS FAILED TO CATEGORISE THE INTEREST PAID AS ABOVE RS.10,000/- AND BELOW RS.10,000/- PER YEAR OF A PARTICULAR INVE STOR. HE ALSO OBSERVED THAT THE ASSESSEE HAS FAILED TO FURNISH FO RM NOS.15H/15G TO SUBSTANTIATE THE INTEREST PAYMENTS W ITHOUT MAKING THE TDS. THEREFORE, HE APPLIED THE PROVISION S OF SECTION 40(A)(IA) OF THE ACT TO RS.67,09,48,000/- I.E., THE INTEREST PAID WITHOUT MAKING TDS AND BROUGHT IT TO TAX. 3. AGGRIEVED, THE ASSESSEE PREFERRED AN APPEAL BEFO RE THE CIT (A) WHO GRANTED PARTIAL RELIEF TO THE ASSESSEE BY HOLDING THAT DURING THE RELEVANT A.Y, THERE WAS NO REQUIREMENT T O MAKE ANY TDS IN RESPECT OF INTEREST PAYMENT OF NOT EXCEEDING RS.10,000/- U/S 194A OF THE ACT. HOWEVER, WITH REGARD TO THE IN TEREST PAYMENT ABOVE RS.10,000/-, THE CIT (A) OBSERVED THAT THE AS SESSEE DID NOT FURNISH ANY FORM NOS.15H/15G. THUS, THE CIT (A) CON FIRMED THE DISALLOWANCE OF INTEREST OF RS.1,42,25,510/- U/S 40 (A)(IA) OF THE ACT. AGAINST THIS ORDER OF THE CIT (A), THE REVENUE IS IN APPEAL BEFORE US BY RAISING THE FOLLOWING GROUNDS OF APPEA L: 1. THE LEARNED CIT (A) ERRED ON FACTS AND LAW OF T HE CASE. 2. THE LEARNED CIT (A) ERRED IN CONCLUDING THAT THE AO ACCEPTED THE CLAIM OF THE APPELLANT IN RESPECT OF I NTEREST PAID BELOW RS.10,000/- TO THE TUNE OF RS.10,77,80,3 28/-, SINCE THE COMPLETE DEPOSITOR DETAILS WERE NOT PRODU CED TO THE AO FOR VERIFICATION.