UNION BANK OF INDIA, MUMBAI V. DY CIT LTU-2, , MUMBAI

ITA 1580/MUM/2020

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 4974 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-04-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: misc
• Appeal Filed On: 09-06-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: DELEING
• Keywords: Reopening of assessment; Rectification of order; Rule of consistency; Earning of tax free income; Non-deduction of tax; Bad and doubtful debts; TDS; Set aside
• Section: 147; 148; 154; 143(3); 244A; 14A; 115JB; 40(a)(ia); 40a(ia); 13

Judgement Text

आयकर अपीलीय अिधकरण मुंबई पीठ “एफ” िवजय पाल राव, एवं गगन गोयल, लेखाकार सद瀡य के IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “F”, MUMBAI BEFORE SHRI VIJAY PAL RAO, JUDICIAL MEMBER & SHRI GAGAN GOYAL,ACCOUNTANT MEMBER I.T.A No.1580/Mum/2020 - A.Y. 2009-10 I.T.A No.1581/Mum/2020 - A.Y. 2000-01 I.T.A No.1582/Mum/2020 - A.Y. 2010-11 I.T.A No.1583/Mum/2020 - A.Y. 2011-12 Union Bank of India Union Bank Bhavan 6 th Floor, 239, Vidhan Bhavan Marg Nariman Point, Mumbai-400 021 PAN : AAACU0564G vs DCIT, LTU (2), Mumbai 29 th Floor, World Trade Centre Centre-1, Mumbai 400 005 APPELLANT RESPONDENT I.T.A No.452/Mum/2021 - A.Y. 2011-12 I.T.A No.453/Mum/2021 - A.Y. 2010-11 I.T.A No.454/Mum/2021 - A.Y. 2009-10 Assistant Commissioner of Income- tax-3(4), Mumbai 29 th Floor, World Trade Centre Centre-1, Mumbai 400 005 vs Union Bank of India Union Bank Bhavan 6 th Floor, 239, Vidhan Bhavan Marg Nariman Point, Mumbai-400 021 PAN : AAACU0564G APPELLANT RESPONDENT Assessee represented by Shri C Naresh Department represented by Shri Sandeep Raj, CIT DR Date of hearing 31/03/2022 Date of pronouncement 07/04/2022 2 Union Bank of India ORDER Per Bench: These are three set of cross appeals for the assessment years 2009-10 to 2011-12 and an appeal by the assessee for the assessment year 2000-01 directed against the respective orders of the Commissioner of Income-tax (Appeal). 2. Firstly, we take up the cross appeals for the aassessment year 2009-10 which are directed against the order dated 13/02/2020 of CIT(A) arising from the order passed under section 154 of the Income-tax Act. The assessee and department has raised following grounds in the cross appeals:- Assessee’s Appeal: “1. The Ld. CIT(A) erred in upholding rectification order of AO dated 07.06.2018 reinstating addition u/s 14A originally withdrawn in order dated 22.12.2017 giving effect to the order of Hon'ble ITAT dated 17.12.2015 that directed the AO to verify and delete the said addition made u/s 14A 2. The Ld CIT(A) failed to appreciate that the AO sought to rectify the giving effect order, that had merged with the orders of Hon'ble ITAT 3 Union Bank of India and therefore interfered with order of Higher Appellate authority by acting beyond his jurisdiction. Reliance is placed on the decision of Hon'ble Madras High Court in case of Seshasayee Paper Boards Ltd v IAC 157 ITR 342 in support of above contention. 3. Without prejudice to above contention, the Ld CIT(A) failed to note that disallowance u/s 14A is a legal and debatable issue as the matter was decided by various High Courts and accordingly is not a matter of rectification u/s 154. 4. Without prejudice to the above, the Ld CIT(A) erred in upholding the disallowance u/s 14A without appreciating that appellant being trader is securities has incurred expenses for buying and selling securities and not for earning of tax free income and accordingly, no disallowance is warranted.” Revenue’s Appeal: “Whether on the facts and in the circumstances of the cased and in law, Ld. CIT(A) erred in holding that as per the decision of Bombay High Court in the case of HDFC Bank Ltd 383 ITR 529, section 14A cannot be applied if assessee’s interest free funds are more than its investments yielding tax free income?” 3. In the earlier round of litigation, the issue of disallowance made under section 14A was carried to this Tribunal and this Tribunal, vide order dated 17/12/2015 directed the Assessing Officer to decide the issue of disallowance under section 14A of the Act r.w.r. 8D alongwith other issues of deduction under section 36(1) afresh. The Assessing Officer has given effect to the order of this Tribunal by passing the order dated 22/12/2017 and allowed the claim of the assessee without making any disallowance sofar as section 14A read with rule 8D is concerned. Thereafter, the Assessing Officer has passed an 4 Union Bank of India order under section 154 on 07/06/2018 and again made the disallowance under section 14A by relying on the judgement of Hon’ble Supreme Court in case of M/s Maxopp Investment Ltd vs CIT in 91 taxmann.com 154. The assessee challenged the order of the Assessing Officer passed under section 154 before the CIT(A), who has granted part relief to the assessee by deleing the addition / disallowance sofar as disallowance of interest expenditure is concerned by accepting the fact that the assessee was having its own interest free funds for making the investment. However, the CIT(A) has confirmed the disallowance made by the Assessing Officer in respect of the common administrative expenditure. Thus, both assessee as well as Revenue have filed the cross appeals. 4. We have heard the Ld.AR as well as Ld.DR and considered the relevant material on record. At the outset we note that for the assessment year and 2008-09, this Tribunal in assessee’s own case in ITA No.4773/um/2019 vide order dated 13/08/2021 has considered this issue in para 15 & 16 as under “15. We have heard both the parties and perused the records. We find that AO has withdrawn, the relief granted u/s. 14A in the assessment order by mentioning that subsequently order of Hon’ble Supreme Court in Maxopp Investment Ltd. 402 ITR 640 has come. Accordingly, he has effectively made the disallowance us/.14A u/s 154 of the Act. We note that the decision of Hon’ble Supreme Court in Maxopp Investment Ltd (supra) did not overrule the proposition that when interest free funds are sufficient still disallowances u/s 8D(ii) needs to be done. Thus, the decision of Hon’ble Bombay High Court in the case of Reliance Industries and HDFC still holds the forte. Furthermore, in the 5 Union Bank of India said case of Maxopp Investment Ltd (supra) itself Hon’ble Supreme Court has upheld the Hon’ble Punjab and Haryana High Court decision to the extent that it was held that disallowances u/s. 14A cannot exceed the exempt income. From the above, it is apparent that said decision of Hon’ble Supreme Court in Maxopp Investment Ltd (supra) does not give a carte blanche to withdraw the relief granted u/s 14A. Or in other words that it mandates that without considering these aspects disallowances has to be done. There is no doubt that Hon’ble Supreme Court held that relief granted from disallowances u/s 14A on the plank that the investment being stock in trade cannot be upheld. Hence, no relief can be granted to assessee on this account. But, it is still deserved relief on the other issue for own interest free funds for the purpose of u/s 8D(ii) and restricting the disallowances with that extent exempt income. These cannot be said to be a subject matter of rectification u/s 154. Hence, upon careful consideration, we hold that the disallowance is not coming under the realm for rectification of mistake u/s 154 and the AO order u/s 154 cannot be presumed to have considered these aspects. 16. Hence, we agree with the submissions of the assesse that order passed by the AO is not sustainable as the issue was debatable and it was not liable for rectification of mistake u/s .154. Hence, we hold that order passed to withdraw the relief granted u/s 14A earlier is bereft of jurisdiction. Hence, we set aside the order of Ld.CIT(A) and decide the issue in favour of the assessee.” Thus, it is clear that the Tribunal has held that the issue of disallowance under section 14A in respect of indirect common interest expenditure as well as indirect common administrative expenditure is a debatable issue and does not fall in the ambit of an error apparent on record which could be rectified under section 154 of the Act. The Tribunal, in the earlier order has discussed various aspects and facts which are required to be considered to take a decision on the issue of disallowance under section 14A r.w.r. 8D of the Income-tax Act. Since the jurisdiction of the Assessing Officer to pass an order under section 154 to withdraw the relief granted under section 14A is held to be barred, therefore, both the issues involved in the cross appeals stand disposed of. Even otherwise, when the Revenue has not disputed the interest free funds with the 6 Union Bank of India assessee to invest in the shares and securities yielding tax free income, then no disallowance is called for under section 14A read with rule 8D(2)(ii). Accordingly, the appeal filed by the assessee is allowed and appeal filed by the Revenue for the assessment year 2009-10 is dismissed. 5. For the Assessment year 2010-11, the assessee and Revenue has raised the following grounds:- Assessee’s Appeal “1. The Ld. CIT(A) erred in upholding rectification order of AO dated 05.06.2018 reinstating addition u/s 14A originally withdrawn in order dated 22.12.2017 giving effect to the order of Hon'ble ITAT dated 08.01.2016 that directed the AO to verify and delete the said addition made u/s 14A 2. The Ld CIT(A) failed to appreciate that the AO sought to rectify the giving effect order, that had merged with the orders of Hon'ble ITAT and therefore interfered with order of Higher Appellate authority by acting beyond his jurisdiction. Reliance is placed on the decision of Hon'ble Madras High Court in case of Seshasayee Paper Boards Ltd v IAC 157 ITR 342 in support of above contention. 3. Without prejudice to above contention, the Ld CIT(A) failed to note that disallowance u/s 14A is a legal and debatable issue as the matter was decided by various High Courts and accordingly is not a matter of rectification u/s 154. 4. Without prejudice to the above, the Ld CIT(A) erred in upholding the disallowance u/s 14A without appreciating that appellant being trader is securities has incurred expenses for buying and selling securities and not for earning of tax free income and accordingly, no disallowance is warranted.” Revenue’s Appeal “Whether on the facts and in the circumstances of the cased and in law, Ld. CIT(A) erred in holding that as per the decision of Bombay High Court in the case of HDFC Bank Ltd 383 ITR 529, section 14A cannot be applied if assessee’s interest free funds are more than its investments yielding tax free income?” 7 Union Bank of India 6. We have heard the Ld.AR as well as Ld.DR and carefully perused the impugned orders of the authorities below. Both the authorised representatives have fairly admitted that the issue in the cross appeals for the assessment years 2010-11 are identical and common to the cross appeals filed for the assessment year 2009-10. Accordingly, in view of our finding on this issue for the assessment year 2009-10, the appeal of the assessee stands allowed and the appeal of the revenue stands dismissed. 7. For the Assessment year 2011-12, the assessee has raised the following grounds:- Reopening of Assessment 1.1 The Ld. CIT(A) failed to appreciate that,AO reopened the assessment after a period of 4 years from the end of the assessment year even when there was no failure on the part of appellant to fully and truly disclose all information required for completion of assessment. Disallowance u/s 40 a(ia) 2.1 The Ld. CIT(A) erred in confirming the disallowance u/s 40a(ia) without appreciating that TD5 is automatically deducted by system and unless there were specific reasons such as exemption certificate etc., question of non-deduction will not arise and the evidence to satisfaction of AO could not be given within a short period due to considerable lapse of time of more than 8 years. Interest u/s 244A 3.1 The Ld. CIT(A) erred in not following the binding decision of Hon'ble ITAT in appellant's own case where it was held that refunds granted should first be adjusted against interest due and thereafter against tax due by wrongly referring to decision of Hon'ble Apex court in case of Gujarat Fluoro Chemicals (358 ITR 291) without appreciating that the said case has no applicability to appellant's case. 3.2 The Id. CIT(A) failed to appreciate that appellant's claim was not for payment of interest over and above interest payable u/s 244A and hence the decision of Hon'ble Delhi High court in case of Indian Farmer Fertilizer co-operative (71 taxmann.com 37) is not applicable to facts of appellants case.” 8 Union Bank of India Ground 1: Regarding validity of reopening of the assessment after four years from the end of the assessment year. 8. The Ld.AR of the assessee has submitted that the Assessing Officer has reopened the assessment after the expiry of four years from the original assessment framed under section 143(3), therefore, the reopening is not valid as hit by the First Proviso to section 147 of the Income-tax Act. He has referred to the reasons recorded by the Assessing Officer in the assessment order at page 2 of the assessment order and submitted that there is no allegation by the Assessing Officer that the income chargeable to tax has escaped assessment by the reason of failure on the part of the assessee to disclose fully and truly all material facts necessary for its assessment. He has contended that in view of the various binding precedents, the reopening of the assessment is not valid and liable to be quashed. The Ld.AR has submitted that for the assessment year 2010-11, an identical issue was considered by this Tribunal vide order dated 032/03/2021 in I.T.A. No2128/MUM/2019 & I.T.A. No.2229/MUM/2019. 9. On the other hand, the Ld.DR has relied upon the orders of authorities below and submitted that it is undisputed fact that the assessee has not deducted tax at source in respect of the interest and the Assessing Officer 9 Union Bank of India received information from TDS Wing, Nagpur during the course of survey in one of the branches of the assessee which revealed that the assessee has not deducted tax at source in the case where interest credited / paid exceeding the basic exemption limit. 10. We have considered the rival submissions as well as relevant materials on record. The original assessment was completed under section 143(3) on 27/02/2014 whereby the Assessing Officer assessed total income of the assessee at Rs2697,50,57,249/- under normal provisions of the Act and book profit under section 115JB at Rs.2811,22,04,789/-. Thereafter giving effect order was also passed on 10/04/2018 pursuant to the order of CITA) dated 26/12/2017. The Assessing Officer in the meantime issued a notice under section 148 on 29/03/2018 and recorded the reason to assess the income by disallowing the claim of interest expenditure under section 40(a)(ia) for want of TDS. The Assessing Officer has stated in the reasons recorded that an information was receive d from the TDS Wing, Nagpur regarding this fact of non deduction of tax at source detected during the survey conducted in one of the branches of the assessee bank. The Assessing Officer finally passed the re- assessment order on 10/12/2018 whereby he made a disallowance of Rs.12,97,323/- under section 40(a)(ia). The assessee challenged the 10 Union Bank of India assessment order before the CIT(A) and also raised the issue of validity of reopening but could not succeed on this issue. 11. At the outset, we note that an identical issue has been considered by the co-ordinate bench of this Tribunal for the assessment year 2010-11 in para 6 as under:- “6. Aggrieved as aforesaid, the assessee assailed the assessment so framed with partial success before Ld. CIT(A) vide impugned order dated 29/01/2019. On the legal issue of reopening, Ld.CIT(A) rejected assessee’s plea by observing that the reassessment proceedings were reopened pursuant to receipt of specific information from TDS wing regarding non-deduction of TDS in certain cases. Based on this information, the case was reopened and examined in AY 2009-10 and disallowance was made u/s 40(a)(ia). Thus, it was a clear case of receipt of tangible information which established that there was failure on the part of assessee to make true and full disclosure of all material facts necessary for assessment. Once reopening was done on a valid ground, other issues which show underassessment or escapement of income could also be considered by Ld. AO and therefore the other grounds of reopening the case, as recorded in the reasons, were also held to be valid. Before us, the Ld. AR has also raised similar grounds and challenged the validity of jurisdiction acquired by Ld. AO for reopening the case. It has been submitted that the assessment was opened after 4 years from the end of relevant assessment year and there was no failure on the part of the assessee to fully and truly disclose all information required for completion of assessment. However, we find that TDS survey carried out by the department against the assessee was subsequent development. The survey findings revealed certain TDS default on the part of the assessee which would require disallowance u/s 40(a)(ia). At the stage of formation of belief, nothing more was required. In our opinion, sufficiency of reason was not a sine-qua-non to reopen assessee’s case rather prima-facie opinion of escapement or underassessment of income was required to be formed at this stage. There was no requirement under law to establish that income, in fact, escaped assessment before triggering reassessment proceedings against the assessee as held by Hon’ble Supreme Court in Raymond Woollen Mills Ltd. v. ITO [236 ITR 34]. In the present case, specific tangible information came into the possession of Ld. AO which revealed possible escapement of income in the hands of the assessee. Nothing more, in our opinion, was required at this stage. Undisputedly, once the case was reopened, the other issues of underassessment or escapement of income could also be examined by Ld. AO. The Ld. AR has also pleaded that 11 Union Bank of India objections filed by the assessee were not disposed-off. However, the said plea has also no substance since the assessee, in response to notice u/.s 148, vide letter dated 04/09/2017, merely submitted that it had fully & truly disclosed all the particulars required for the assessment at the time of filing of return of income and at the time of various hearings for assessment u/s 143(3) whereas it is notable that case has been reopened on the basis of subsequent receipt of tangible information. Therefore, we concur with the view of Ld. CIT(A), in this regard and dismiss ground no.1 raised by the assessee.” To maintain the rule of consistency, we follow the earlier order of this Tribunal on this issue and consequently ground 1.1 of the appeal is dismissed. 12. Ground 2.1 is regarding disallowance made by the Assessing Officer under section 40(a)(ia) which was confirmed by the CIT(A). 13. We have heard the Ld.AR as well as the Ld.DR and considered materials on record. At the outset, we note that this issue has been considered by the co-ordinate bench of this Tribunal for the assessment year 2011-12 vide order dated 03/03/2021 (supra) in para 8 as under “8. The disallowance u/s 40(a)(ia) was confirmed by Ld. CIT(A) since the assessee was not able to explain the reason for non-deduction of tax at source with proper evidences. Aggrieved, the assessee is in further appeal before us by way of ground no. 3. It has been submitted before us that evidence to the satisfaction of Ld. AO for reasons of non-deduction tax such as Form 15G/15H etc. could not be furnished since considerable period of time had lapsed. The Ld. AR submitted that tax was automatically deducted by the systems and hence the chances of non- deduction without adequate reasons were remote. Upon due consideration of factual matrix, the bench deem it fit to grant another opportunity to the assessee to furnish requisite evidences Ld. AO in support of non-deduction of tax at source or alternatively prove applicability of second proviso to Sec. 40(a)(ia). This ground stand allowed for statistical purposes.” 12 Union Bank of India Thus, it is clear that the Tribunal has set aside this issue to the record of the Assessing Officer for verification and examination of the relevant evidence to be produced by the assessee to show that no TDS was required to be deducted or alternatively to prove the applicability of Second Proviso to section 40(a)(ia). Following the earlier decision of this Tribunal, we set aside this issue to the record of the Assessing Officer on same terms and directions. 14. The Revenue in the cross appeal has raised the following ground:- “1. Whether on the facts and in the circumstances of the case and in law, Ld.CIT(A) was right in holding that the provisions of section 115JB of the I.T. Act are not applicable to the assessee, without appreciating the facts of the case?” 15. We have heard the Ld.DR as well as Ld.AR and carefully perused the orders of authorities below. The CIT(A) has decided this issue in favour of the assessee in para 10.1 as under:- “10.1 I have carefully considered the submissions of the assessee. The ClT(A)- 2,Mumbai vide Appeal No.CIT(A)-2/IT/19/20l7-18 dated 26/12/2017 for A.Y. 2011-12 has specifically held that the provisions of section 115 JB do not apply to the assessee. It is not clear as to why the AO hag not noted this direction, Be ns it may, it is also noted that this issue is covered in favour of the assessee by the order of the ITAT in the appellant's own case for AY 2007-08 as well as in A.Y. 2010-11 (ITA No.2142 & 1627/Mum/2014). Recently the jurisdictional High Court in the case of the assessee titled CIT-LTU vs. Union Bank of India[2019] 263 Taxman 685 (Bombay)had also held that the provisions of section 115JB, as it stood prior to its amendment by virtue of Finance Act, 2012, would not be applicable to a banking company governed by provisions of Banking Regulation Act, 1949. In view of the above, this ground of appeal of the assessee is allowed and it is held that the provisions of section 115JB are not applicable to the assessee for this year and accordingly Ground No.4 is allowed.” 13 Union Bank of India 16. Thus, the CIT(A) has followed the decision of the Tribunal in assessee’s own case as well as the judgement of Hon’ble jurisdictional High Court in assessee’s own case reported in 263 Taxman 685 (Bom). We further note that this Tribunal for the assessment year 2009-10 vide order dated 03/03/2021 (supra) has considered this issue in para 9 as under:- “The sole subject matter of revenue’s appeal is applicability of Sec.115JB to the assessee Bank for the year under consideration. Regarding adjustment of Book Profits u/s 115JB, relying upon Tribunal decision in assessee’s own case for AY 2007-08 as well as in AY 2010- 11, Ld. CIT(A) held that the provisions of Section 115JB were not applicable to the assessee bank. Aggrieved, the revenue is in further appeal before us. We find that the issue of applicability of Section 115JB (prior to its amendment by virtue of Finance Act, 2012) to Banking Company governed by the provisions of Banking Regulation Act, 1949 is squarely covered in assessee’s favor by the decision of Hon’ble High Court of Bombay in assessee’s own case for AY 2005-06 which is reported at 105 Taxmann.com 253 dated 16/04/2019. A copy of the same is on record. The Ld. DR is unable to controvert the same. Therefore, no fault could be found in the impugned order, in this regard.” 17. Though the Ld.DR has submitted that the Revenue has filed an SLP against the judgement of Hon’ble jurisdictional High Court; however, till the judgement of Hon’ble High Court is not disturbed or stayed by the Hon’ble Supreme Court, the same is binding on the issue. Accordingly, following the earlier order of this Tribunal as well as the judgement of the Hon’ble jurisdictional High Court in assessee’s own case, we do not find any error or illegality in the impugned order of the CIT(A) on this issue. Consequently, the appeal of the revenue is dismissed. 14 Union Bank of India ITA No.1581/Mum/2020 - A.Y. 2000-01 18. This appeal by the assessee is directed against the order dated 13/02/2010 of CIT(A) arising from the order of levy of interest under section 220(2) of the Income-tax Act for the assessment year 2000-01. The assessee has raised the following grounds 1. The Id. CIT(A) erred in dismissing the appeal against order of AO dated 24.05.2018 by merely stating that an order u/s 220(2) is not an appealable order, overlooking the fact that appeal itself was on the ground that there would be no demand outstanding for the relevant assessment year had AO considered the appellate orders passed but not given effect to by him and hence there is no question of any interest due from appellant.. 2. The Id. CIT(A) ought not to have brushed aside appellant's contention that AO was mandated to give effect to order of CIT(A) dated 25.10.2012 to rectify mistake apparent from AO's order dated 02,03.2011 and therefore the order of AO over-Looking the co-existing appellate order being bad in law be set aside. 2.1 The Id. CIT(A) failed to note that if order of CIT(A) dated 25.10.2012 is given effect, there will only be a refund due and hence the question of charging any interest u/s 220(2) does not arise. 3. The Id. CIT(A) erred in not deciding on the issue of short granting of interest u/s 244A which arose on account of AO not following the specific directions of Id. CTI(A) of adjusting the refunds granted first against the interest refund due and thereafter against the tax refund due.” 19. The Ld.AR of the assessee has submitted that the CIT(A) has dismissed the appeal of the assessee on the technical ground that the order passed under section 220(2) is not an appealable order. He has pointed out that the impugned order of the CIT(A) is contrary to various decisions on this issue wherein it has been held that appeal lies against the charging of interest under section 220(2), if the order of the Assessing Officer levying interest is arbitrary. 15 Union Bank of India In support of his contention he has relied upon the decision of the co-ordinate bench of this Tribunal in case of ACIT vs Hindalco Industries Ltd 4 SOT 757 (Mum). The Ld.AR has, then submitted that an identical issue has been considered by the Gauhati Bench in case of India Carbon Ltd 122 TAXMAN 76 (Gauh). He has also relied upon the judgement of Hon’ble Delhi High Court in case of Televista Electronics Ltd (2017) 88 taxmann.com 148 (Del) and submitted that the Hon’ble High Court has upheld the order of the Tribunal whereby it was decided that levy of interest under section 220(2) while passing the order under section 154 had effect of enhancing assessment and the appeal filed against said order would be maintainable under clause (c) of section 246(1) of the Act. Hence, the Ld.AR has submitted that the CIT(A) would have decided the appeal on merits instead of dismissing the same in limine. He has pointed out that the Assessing Officer has levied the interest under section 220(2) without giving effect to the order of CIT(A) dated 25/10/2012. The Assessing Officer has also not allowed the correct interest under section 244A as directed by the CIT(A) resulting in short granting of interest of Rs.38,53,75,162/-. Thus, the Ld.AR contended that had the Assessing Officer given the effect to the order of CIT(A) dated 25/10/2012, there would have been no charging of interest under section 220(2). The 16 Union Bank of India Ld.AR has pointed out that the assessee filed a petition under section 154 of the Income-tax Act to rectify the mistake while levying the interest under section 220(2) without giving effect to the order of the CIT(A) dated 25/10/2012; however, till date the Assessing Officer has not passed any order on the petition filed under section 154 of the Act. 20. On the other hand, the Ld.DR has submitted that the decisions relied upon by the Ld.AR are not applicable in the present case as in this case, there is no order passed by the Assessing Officer under section 154 whereas in those cases, the order was passed by the Assessing Officer under section 154 r.w.s. 220(2) of the Income-tax Act. Therefore, when the Assessing Officer has not disturbed the total income of the assessee while passing the order under section 220(2), then the said order is not an appealable order and cannot be challenged in the appeal. He has relied upon the order of the CIT(A) on this issue. 21. We have considered the rival submissions as well as relevant materials on record. The present controversy a result of multi round litigation for the year under consideration. Originally, the order under section 143(3) was passed on 28/02/2003 whereby the Assessing Officer made an adjustment in the book profit on account of bad and doubtful debts to the 17 Union Bank of India tune of Rs.201 crores. The assessee challenged the action of the Assessing Officer before the CIT(A), but could not succeed. In the second appeal, this Tribunal in ITA No.5105/Mum/2004 vide order dated 09/05/2008 allowed the claim of the assessee by following the Special Bench decision in case of JCIT vs Usha Martin Industries Ltd 104 ITD 249 (Cal)(SB). The department filed an M.A. against the said order of the Tribunal in view of the amendment in the provisions of section 115JB by the Finance Act, 2009 wherein the Tribunal vide order dated 19/11/2010 allowed the M.A. and directed the Assessing Officer to examine the case as per accounts prepared in accordance with Schedule 6 of Companies’ Act. The Assessing Officer consequently added back the said amount of provision for bad and doubtful debts to the book profit. The said giving effect order was challenged by the assessee before the CIT(A) and the CIT(A), in para 8.1 of the order dated 25/10/2012, has observed as under:- “8.1 Therefore, as per the above computation Rs.201,00,00,000/- was deleted. Subsequent to this the ITAT reversed its decision as per MA dt. 31/01/2011. In the giving effect order the AO mentioned the addition of Rs.235,37,03,000/-. Thus, apparently there was a mistake crept in, thus, the AO is directed to verify the records and consider the same.” Thus, it is clear that it was noted by the CIT(A) that there was a mistake crept in the order of the Assessing Officer giving effect to the order of the Tribunal and consequently, the Assessing Officer was directed to verify the record and 18 Union Bank of India consider the same. The CIT(A) has further found that it is apparent that the Assessing Officer has made a mistake in taking the figure from record and added Rs.115,35,20,000/- instead of Rs.11,53,52,000/-, The said fact is recorded by CIT(A) in para 9 to 9.2 of order dt. 25.10.2012. The Ld.DR has not disputed this mistake and discrepancy in the computation made by the Assessing Officer while passing the giving effect order in pursuance to the order of the CIT(A). The CIT(A) also granted part relief in respect of interest under section 244A of the Income-tax Act which shall have an effect on the demand of tax and consequential charging of interest under section 220(2) of the Income-tax Act. Therefore, a substantial relief was granted by the CIT(A) while passing the order dated 25/12/2012. But the Assessing Officer has passed the impugned order under section 220(2) without giving effect to the order of the CIT(A). It appears that the Assessing Officer has deliberately not passed any order to give effect to the order of the CIT(A) despite the fact that the assessee had already filed a petition under section 154 of the Income-tax Act to rectify the mistakes. Once the Assessing Officer has not challenged the order of the CIT(A) dated 25/10/2012, then the Assessing Officer is bound to follow the said order in letter and spirit. The non passing of the giving effect order amounts disobedience and judicial indiscipline on the part of the 19 Union Bank of India Assessing Officer which is a serious matter to be considered by the appropriate authority. Accordingly, in the facts and circumstances of the case, we find that the Assessing Officer has acted in a highly arbitrary manner while passing the impugned order under section 220(2) for charging the interest without first determining the tax liability of the assessee in accordance with the issues settled in appeal. Accordingly, in the interest of justice, we set aside the orders of the authorities below and remand the issue to the record of the Assessing Officer to readjudicate the same after giving effect to the order of the CIT(A) dated 25/10/2012. Assessee’s appeal is allowed, for statistical purpose. 22. In the result, appeals filed by the assessee for assessment years 2009-10 and 2010-11 are allowed; appeal filed by the assessee for assessment year 2011-12 is partly allowed and appeal filed by the assessee for A.Y. 2000-01 is allowed for statistical purpose. The appeals filed by the revenue for the A.Y. 2009-10 to 2011-12 are dismissed. Order pronounced in the open court on 07/04/2022. Sd/- sd/- (GAGAN GOYAL) (VIJAY PAL RAO) लेखा /ACCOUNTANT MEMBER /JUDICIAL MEMBER Mumbai, Dated: 07/04/2022 Pavanan 20 Union Bank of India ितिलिप अ ेिषतCopy of the Order forwarded to : 1. /The Appellant , 2. / The Respondent. 3. आयकर (अ)/ The CIT(A)- 4. आयकर CIT 5. िवभागीय " #, आय.अपी.अिध., मुबंई/DR, ITAT, Mumbai 6. ! $% फाइल/Guard file. BY ORDER, //True Copy// (Dy./Asstt. Registrar) ITAT, Mumbai