Shri Bhayavadar Seva Sahakari Mandali Ltd. , Rajkot V. The Pr. CIT-1, Rajkot, Rajkot

ITA 149/RJT/2023

• Counselvise Citation: [2024] 100 COUNSELVISE.COM (IT) 3731 (ITAT-RAJKOT)
• Duration Of Justice: 9 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-02-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 06-02-2024
• Assessment Year: 2018-2019
• Appeal Filed On: 15-05-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHRISHRAMDEEPSINHA; INVIEWOFABOVEDISCUSSION; ITISFOUNDTHATTHEASSESSMENTORDERPASSEDBYTHEA.O
• Assessee Lawyers: SHRIVIMALDESAI

Judgement Text

आयकरअपीलीयअधिकरण , राजकोटनयायपीी INTHEINCOMETAXAPPELLATETRIBUNAL, RAJKOTBENCH,RAJKOT (ConductedthroughVirtualCourt) BEFORESHRIWASEEMAHMED,ACCOUNTANTMEMBER And SHRITRSENTHILKUMAR,JUDICIALMEMBER आयकरअपीलसं./ITANo.149/Rjt/2023 धििाधरणणवध/Asstt.Year:2018-2019 ShriBhayavadarSevaSahakari MandliLtd., At.Bhayavadar, Tal.Upleta, Rajkot-360490. C/o.Sarda&Sarda,CAs, 1 st Floor,“Sakar”, Dr.RadhakrishnanRoad, Opp.RajkumarCollege, Rajkot-360001. PAN:AAAAS2358C Vs.ThePrincipalCommissioner ofIncomeTax-1, Rajkot. (Applicant)(Respondent) And आयकरअपीलसं./ITANo.177/Rjt/2023 धििाधरणणवध/Asstt.Year:2018-2019 SahayogSevaSahakariMandaliLtd., At.Moviya, Tal.Gondal, Rajkot-360311. C/o.Sarda&Sarda,CAs, 1 st Floor,“Sakar”, Dr.RadhakrishnanRoad, Opp.RajkumarCollege, Rajkot-360001. PAN:AAAAS3021N Vs.ThePrincipalCommissioner ofIncomeTax-1, Rajkot. (Applicant)(Respondent) Assesseeby:ShriVimalDesai,A.R Revenueby:ShriShramdeepSinha,CIT.DR ITANo.149&177/Rjt/2023 A.Y.2018-19 2 सुिणाईकीतारीख/DateofHearing:07/02/2024 घोवणाकीतारीख /DateofPronouncement:21/02/2024 आदेश /ORDER PERWASEEMAHMED,ACCOUNTANTMEMBER: Thecaptionedappealshavebeenfiledattheinstanceofdifferentassessee againsttheseparateordersoftheLd.PrincipalCommissionerofIncomeTax-1, RajkotarisinginthematterofproceedingscarriedoutunderSection263ofthe IncomeTaxAct,1961(here-in-afterreferredtoas"theAct")relevanttothe AssessmentYear2018-19.First,weuptakeITANo.149/Rjt/2023,forAY 2018-19,anappealbytheassesseeinthecaseofM/sBhayavadavSeva SahakariMandliLtd. 2.TheonlyissueraisedbytheassesseeisthattheLd.PCITerredinholding theassessmentorderpassedu/s143(3)oftheAct,aserroneousinsofar prejudicialtotheinterestoftherevenue. 3.Inthepresentcase,theLd.PCITheldthattheassesseehasearned interestincomeontheFDRsmaintainedwithCo-op.BankamountingtoRs. 25,419/-whichwasnoteligiblefordeductionu/s80P(2)(d)oftheAct.Thus,the Ld.PCITheldtheassessmentorderaserroneousinsofarprejudicialtothe interestoftherevenuebyobservingasunder: Inviewofabovediscussion,itisfoundthattheassessmentorderpassedbytheA.O u/s.143(3)oftheActdated10/02/2021iserroneousandprejudicialtotheinterestofthe revenue.Byvirtueofthepowersvestedinmeu/s.263oftheI.TAct,Iherebyset-aside theorderu/s.143(3)oftheActdated10/02/2021ontheissuesdiscussedaboveand directtheAssessingOfficertopassafreshassessmentorderafterdenyingdeduction u/s.80P(2)(d)onsuchinterestincomeofRs.25,419/-.TheA.Oisalsodirectedtoverifyif thesocietyhasclaimedanydividendorinterestfromsavingsaccountofCo-operativebank, theA.Oshoulddisallowdeductionu/s.80P(2)(d)or80P(2)(a)(i)oftheActonsuchinterest income. ITANo.149&177/Rjt/2023 A.Y.2018-19 3 4.BeingaggrievedbytheorderoftheLd.PCIT,theassesseeisinappeal beforeus. 5.TheLd.ARbeforeusfiledtwopaperbooksrunningfrompages1to69and 1to35alongwiththewrittensubmissionsandcontendedthattheassesseehas notreceivedanyinterestordividendfromanyco-operativebank.Therefore,the questionofanymakingdisallowance,oftheinterestindispute,doesnotarise. TheLd.ARfurtherdrawnourattentiontopageNos.5to10ofthefirstpaper bookdemonstratingthattheamountofinterestofRs.25,419/-wasreceivedfrom variouspartieswhichwasinthenatureofpenalinterest.Assuch,itwas submittedbytheLd.ARthatonaccountofdelayedpaymentbythemembers, penalinterestwaschargedwhichiseligiblefordeductionu/s80(P)(2)(a)(i)ofthe Act.Thus,itwasassailedbytheLd.ARthattheLd.PCIThasheldtheassessment orderaserroneousinsofarprejudicialtotheinterestoftherevenueonwrong assumptionsoffacts. 6.Onthecontrary,theLd.DRvehementlysupportedtheorderoftheld.PCIT. 7.Wehaveheardtherivalcontentionsofboththepartiesandperusedthe materialsavailableonrecord.Fromtheprecedingdiscussion,wenotethattheLd. PCIThasobservedcertaindifferenceintheamountofinterestincomeshownin theprofitandlossaccountandintheledgeraccountofinterestincome.Thus, basedonsuchdifferenceofRs.25,419/-,theLd.PCITinferredthatsuchinterest representstheinterestfromCo.op.Bankandthereforehedisallowedthesame. However,fromthesubmissionoftheassessee,wenotethatsuchinteresthasnot beenreceivedfromtheCo.opBank.Inthisregard,wehavereferredtonotice issuedu/s142(1)oftheAct,requiringtheasseseetofurnishthedetailsasunder: WithrespecttothedeductionsclaimedunderchapterVI-Aduringtheyeatunder consideration,kindlyprovidethefollowingdetails: a.Section/sub-sectionwisedetailsofdeductionsclaimedunderVI-A. b.Detailsofearningsundertherelevantheadsagainstwhichdeductionclaimed. c.NoteoneligibilitycriteriaofdeductionsclaimedunderdifferentsectionsofChapterVIA d.Detailsofallthebankaccountsalongwiththebankstatementfortheyeartosupportthe claim. ITANo.149&177/Rjt/2023 A.Y.2018-19 4 e.Documentaryevidenceinrespectofinvestment/expenditure/paymentetc.Madetoclaim thedeductions. 7.1Inreplytotheabovenotice,theassesseehassubmittedasunder: 4.DeductionUnderSectionVI-A. A.DeductionclaimU/s.80P(2). B.Headwisegrossearninganddeductionclaimonitisasunder. i.Grossprofitonsaleoffertilizer,Seeds,PesticidesandotheragricultureequipmentsRs. 16,11,667isexemptU/s8OP(2)(iii)&8(iv) ii.InterestreceivedfromagriculturemembersRs.1,61,61,572isexemptU/s8OP(2)(i) iii.SharedividendreceivedfromotherCo-op.societyRs.15,51,185isexemptU/u80P(2)(d) iv.RebateonfertilizersaleRs.2,13,905isexemptU/s.80P(2)(iii)&(iv) v.GodownrentincomeforstorageofagricultureproductsRs.23,470isexemptU/s. 80P(2)(e) AfterdeductingadministrationexpensenetincomeofRs.32,37,137isclaimasdeduction U/s.VIA(80P). 7.2FromtheabovequestionraisedbytheAOandthereplymadebythe assesseethereto,wenotethatthereisnoreferencetointerestreceivedfromCo- opBank.Atthetimeofhearing,theLd.ARbeforeusdulydemonstratedthatthe impugnedamountofinterestofRs.25,419/-wasreceivedfromthemembersonly andnotfromtheCo-operativeBank.Theargumentwasalsonotcontrovertedby theLd.DRonbehalfoftherevenue.EvenonperusaloftheorderofLd.PCITwho afterpointingoutdifferenceintheamountofinterestasdiscussedabove,has reachedtotheconclusionthatsuchdifferencerepresentstheinterestfromtheco- operativebankbutwhatwefindisthisthatsuchconclusionoftheLd.PCITwas notbasedonanymaterial.Therefore,weholdthattheLd.PCIThasconcluded theassessmentorderaserroneousinsofarprejudicialtotheinterestofrevenue onwrongassumptionsoffactsandtherefore,his(theld.PCIT)orderunder section263oftheActisnotsustainable.Accordingly,wequashtheorderpassed bytheLd.PCITu/s263oftheAct.Hence,thegroundofappealoftheassesseeis allowed. ITANo.149&177/Rjt/2023 A.Y.2018-19 5 7.3Intheresult,theappealfiledbytheassesseeisallowed. ComingtoITANo.177/Rjt/2023,anappealbytheassesseeinthecase ofM/sSahayogSevaSahakariMandaliLtd.fortheAY2018-19. 8.Attheoutset,wenotethattheissueraisedbytheassesseeinitsgrounds ofappealfortheAY2018-19inthecaseofSahayogSevaSahakariMandali Ltd.isidenticaltotheissueraisedbytheassesseeinITANo.149/Rjt/2023for theassessmentyear2018-19inthecaseofShriBhayavadarSevaSahakari MandaliLtd.Therefore,thefindingsgiveninITANo.149/Rjt/2023shallalsobe applicabletotheITANo.177/Rjt/2023.TheappealoftheassesseefortheAY 2018-19bearingITANo.149/Rjt/2023inthecaseofShriBhayavadarSeva SahakariMandaliLtd.hasbeendecidedbyusvideparagraphNo.7ofthis orderinfavouroftheassessee.ThelearnedARandtheDRalsoagreedthat whateverwillbethefindingsfortheITANo.149/Rjt/2023inthecaseofShri BhayavadarSevaSahakariMandaliLtd.forAY2018-19shallalsobe appliedtotheITANo.177/Rjt/2023inthecaseonhandi.e.SahayogSeva SahakariMandaliLtd.fortheAY2018-19.Hence,thegroundofappealfiledby theassesseeisherebyallowed. 8.1Intheresult,theappealfiledbytheassesseeisallowed. 9.Inthecombinedresult,boththeappealsfiledbythedifferentassesseeare allowed. OrderpronouncedintheCourton21/02/2024atAhmedabad. S Sd/-Sd/- (TRSENTHILKUMAR)(WASEEMAHMED) JUDICIALMEMBERACCOUNTANTMEMBER (TrueCopy) Ahmedabad;Dated21/02/2024 Manish,Sr.PSTRUECOPY