Janta Bank Sevakanchi Sahakari Credit Society Ltd., Karad V. ITO, Wd 1, Satara, Satara

ITA 1355/PUN/2007

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 59995 (ITAT-PUNE)
• Duration Of Justice: 4 year(s) 4 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-02-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 18-01-2012
• Assessment Year: 2004-2005
• Appeal Filed On: 22-10-2007
• Result in Favour of: Assessee
• Court: TRIBUNAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B , PUNE BEFORE SHRI I.C. SUDHIR (JM) AND SHRI D. KARUNAKARA RAO (AM) ITA NO.1355/PN/2007 (ASSTT. YEAR : 2004-05) JANATA BANK SEVAKANCHI , ... APPELLANT SAHAKRI CREDIT SOCIETY LTD, SHIVAJINAGAR, KARAD PAN : A AALK0162B V. INCOME TAX OFFICER RESPONDENT WARD 1, SATARA APPELLANT BY : SHRI. M.K. KULKARNI RESPONDENT BY : MS. ANN KAPTHUAMA/ SHRI S.K.AMBASTH A DATE OF HEARING : 18-01-12 DATE OF PRONOUNCEMENT : -2-12 ORDER PER I.C. SUDHIR, JM THE ASSESSEE HAS QUESTIONED FIRST APPELLATE ORDER ON THE FOLLOWING GROUNDS : 1) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW THE ACTION U/S. 147 WAS NOT JUSTIFIED AS THERE WAS NO E SCAPEMENT OF INCOME WITHIN THE MEANING OF THAT SECTION. IN VIEW OF THIS THE ASSESSMENT BE ANNULLED. 2) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW THE ENTIRE INSURANCE COMMISSION RECEIVED BY THE APPELL ANT-SOCIETY WAS EXEMPT U/S. 80-P (2)(A)(I) OF THE ACT THE SAME WAS SHOWN AND DECLARED IN THE RETURN AS TAXABLE FILED IN RESP ONSE TO NOTICE U/S. 148 OF THE ACT, UNDER MIS-CONCEPTION OF LAW. THE EXEMPTION ACCORDINGLY BE ALLOWED. 3) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW AND EVEN AFTER ADDITION OF THE INSURANCE COMMISSION OR FOR THAT MATTER ANY OTHER INCOME TO TOTAL INCOME WOULD HAVE TO BE ALLOWED AS DEDUCTION U/S. 80-P (2)(A)(I) OF THE AC T AND THE SAME BE ALLOWED ACCORDINGLY. ITA . NO1355/PN/2007 JANATA BANK SEVAKANCHI SAH. CREDIT SOCIETY LTD. A.Y. 2004-05 PAGE OF 4 2 4) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW THE THRESHOLD INCOME WHICH IS NOT TAXABLE CANNOT BECOME TAXABLE EVEN IN THE RETURN OF INCOME FILED UNDER THE LAW. 5) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW THE APPELLANT-SOCIETY DENIES ITS LIABILITY TO PAY INTER EST U/S. 234-B AND 234-C OF THE ACT. 2. DURING THE COURSE OF HEARING, THE LD. A.R. SUBMI TTED THAT THE ASSESSEE DOES NOT WISH TO PRESS GROUND NOS. 1 & 2. THESE GROUNDS ARE ACCORDINGLY REJECTED AS WITHDRAWN. 3. IN GROUND NOS. 3 & 4 THE ISSUE RAISED IS AS TO W HETHER THE ASSESSEE IS ELIGIBLE FOR DEDUCTION U/S. 80P(2)(A)(I) OF THE ACT ON THE RECEIPT OF INSURANCE COMMISSION AS PART OF ITS BANKING BUSINES S. 4. AT THE OUTSET OF HEARING, THE LD. A.R. POINTED T HAT AN IDENTICAL ISSUE IN THE CASE OF CO-OPERATIVE BANK, THE PUNE BENCH OF THE TRIBUNAL HAS DECIDED THE SAME IN FAVOUR OF THE ASSESSEE. HE CIT ED FOLLOWING DECISIONS IN SUPPORT : 1. JANATA BANK SEVAKANCHI SAHAKARI CREDIT SOCIETY V S. ITO, ITA NO. 1477/PN/2008 ( A.Y. 2005-06), ORDER DATED 31 ST DECEMBER , 2008. 2. THE KARAD URBAN CO-OP. BANK LTD., VS. ITO, ITA N O. 1552/PN/2008 (A.Y. 2005-06), ORDER DATED 11 TH NOVEMBER 2009. 5. THE LD. D.R. ON THE OTHER HAND TRIED TO JUSTIFY THE ORDERS OF THE AUTHORITIES BELOW. 6. THE RELEVANT FACTS ARE THAT THE ASSESSEE SOCIETY HAD EARNED INCOME FROM INSURANCE COMMISSION AMOUNTING TO RS. 5,75,099 /- WHICH HAS BEEN ITA . NO1355/PN/2007 JANATA BANK SEVAKANCHI SAH. CREDIT SOCIETY LTD. A.Y. 2004-05 PAGE OF 4 3 DENIED BY THE AUTHORITIES BELOW ON THE BASIS THAT T HE SAME WAS NOT PART OF THE BANKING BUSINESS OF THE ASSESSEE, HENCE NOT ELIGIBLE FOR DEDUCTION U/S. 80P(2)(A)(I) OF THE ACT. THE CONTENTION OF A SSESSEE BEFORE THE LD CIT(A) REMAINED THAT IN VIEW OF DECISION OF PUNE BE NCH OF THE TRIBUNAL IN THE CASE OF MAHAVIR NAGAR PAT SANSTHA, 74 TTJ 793 ( PUNE), EVEN AFTER ADDITION OF INSURANCE COMMISSION OF RS. 5,77,099/-, THE TAXABLE INCOME WILL REMAIN NIL. 7. WE FIND THAT AN IDENTICAL ISSUE IN THE ABOVE CIT ED DECISIONS OF PUNE BENCH OF THE TRIBUNAL IN THE CASES OF JANATA BANK S EVAKANCH SAHAKARI CREDIT SOCIETY LTD. VS. ITO (SUPRA) AND KARAD URBA N CO-OP. BANK LTD. VS. ITO (SUPRA). RESPECTFULLY FOLLOWING THESE DECI SIONS, WE HOLD THT THE RECEIPT OF INSURANCE COMMISSION ON THE PREMIUM PAID BY ITS MEMBERS WAS A PART OF THE BANKING BUSINESS ELIGIBLE FOR DED UCTION U/S. 80P(2)(A) OF THE ACT. WE ACCORDINGLY DECIDE THE ISSUE RAISED IN GROUND NOS. 3 & 4 IN FAVOUR OF THE ASSESSEE WITH DIRECTION TO A.O TO ALL OW THE CLAIMED DEDUCTION. THE GROUND NOS. 3 & 4 ARE ACCORDINGLY A LLOWED. GROUND NO.5 8. IT IS REGARDING CHARGING OF THE INTEREST U/S. 23 4-B AND 234-C OF THE ACT WHICH IS CONSEQUENTIAL IN NATURE. HENCE THE G ROUND DOES NOT NEED SEPARATE ADJUDICATION. 9. IN THE RESULT, APPEAL IS ALLOWED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 24TH FEBRUARY 2012. SD/- SD/- ( D. KARUNAKARA RAO ) ACCOUNTANT MEMBER ( I.C. SUDHIR ) JUDICIAL MEMBER PUNE, DATED THE 24TH FEBRUARY, 2012 ITA . NO1355/PN/2007 JANATA BANK SEVAKANCHI SAH. CREDIT SOCIETY LTD. A.Y. 2004-05 PAGE OF 4 4 US COPY OF THE ORDER IS FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT -III, PUNE 4. THE CIT(A)- II,PUNE 5. THE D.R. B BENCH, PUNE 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL PUNE