M/s Koppal Government Primary School Teachers Society , Koppala V. Income Tax Officer Ward-1 , Koppal

ITA 2118/BANG/2018

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 2379 (ITAT-BANGALORE)
• Duration Of Justice: 1 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-08-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2014-2015
• Appeal Filed On: 03-07-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: R E BALASUBRAMANIAN
• Keywords: Opportunity of being heard

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC-C BENCH, BANGALORE BEFORE SHRI. SUNIL KUMAR YADAV, JUDICIAL MEMBER ITA NOS. 2117 AND 2118 /BANG/201 8 ASSESSMENT YEARS : 20 13 - 1 4, 2014 - 15 M/S. KOPPAL GOVERNMENT PRIMARY SCHOOL TEACHERS SOCIETY, 620 958/3, BEHIND GOVERNMENT HOSPITAL, KOPPALA : 583 231. PAN : AAAAK 3465 E VS. THE INCOME-TAX OFFICER, WARD 1, KOPPAL. APPELLANT RESPONDENT ASSESSEE BY : SHRI. R. E. BALASUBRAMANIAN, CA REVENUE BY : SHRI. PRIYADARSHI MISHRA, JCIT, SPECIAL RANGE - III DATE O F HEARING : 13 /0 8 /201 8 DATE OF PRONOUNCEMENT : 31 / 0 8 /201 8 O R D E R PER SUNIL KUMAR YADAV, JM : THESE APPEALS ARE PREFERRED BY THE ASSESSEE AGAINST THE RESPECTIVE ORDERS OF THE CIT(A). SINCE COMMON GROUNDS ARE RAISED IN BOTH THE APPEALS, GROUNDS RAISED IN ITA NO. 2117/BANG/2018 ARE EXTRACTED AS UNDER: THE APPELLANT OBJECTS TO THE ORDER OF THE LD.CIT(A) ON THE FOLLOWING GROUNDS THAT: 1. THE IMPUGNED ORDER IS OPPOSED TO FACTS AND LAW IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF THE APPELLANT. 2. THE LD.CIT(A) ERRED IN DENYING THE DEDUCTION UNDER SECTION 80P(2) OF THE INCOME TAX ACT IN RESPECT OF INTEREST INCOME RECEIVED FROM VARIOUS BANK AND IN DOING SO A) THE LD.CIT(A) FAILED TO APPRECIATE THAT THE INTEREST INCOME FROM OTHER BANKS ARE ATTRIBUTABLE TO PROFITS AND GAINS OF THE BUSINESS OF EXTENDING CREDIT FACILITIES TO APPELLANT'S MEMBERS. ITA NOS. 2117 AND 2118/BANG/2018 PAGE 2 OF 3 B) THE LD.CIT(A) FAILED TO APPRECIATE THAT THE BUSINESS OF THE APPELLANT CONSIST ENTIRELY OF EXTENDING CREDIT FACILITIES TO ITS MEMBERS AND THE INTEREST INCOME FROM VARIOUS BANKS AROSE ONLY ON ACCOUNT OF KEEPING THE SURPLUS FUNDS FOR THE TIME BEING IN ANTICIPATION OF LENDING THE SAME TO THE MEMBERS AS THERE WERE NO READY BORROWERS FOR THE SAID AMOUNT. 3. THE LD.CIT(A) FAILED TO APPRECIATE THE FACT THAT THE APPELLANT HAS ONLY ORDINARY MEMBERS AND NO NOMINAL MEMBERS AND DURING THE NORMAL COURSE OF ITS BUSINESS HAS ONLY DEALT WITH ITS OWN MEMBERS AND NOT WITH ANY NOMINAL MEMBERS AS PER THE DECISION OF THE HONOURABLE SUPREME COURT IN THE CITIZEN CO-OPERATIVE SOCIETY LIMITED. 4. WITHOUT PREJUDICE TO GROUND NO.2 AND AS AN ALTERNATE PLEA THE APPELLANT FURTHER SUBMITS THAT IN RESPECT OF THE INCOME EARNED FROM THE CO-OPERATIVE BANKS IT IS ENTITLED FOR DEDUCTION U/S 80P (2) (D) OF THE ACT INASMUCH AS THE CO-OPERATIVE BANKS ARE ALSO CO- OPERATIVE SOCIETIES AS PER SECTION 2(B1) OF KARNATAKA CO-OPERATIVE SOCIETIES ACT, 1959. 5. FOR THESE AND SUCH OTHER GROUNDS THAT MAY BE ADDUCED IN TIME TO TIME, IT IS REQUESTED THAT THE HON'BLE ITAT TO CANCEL THE ADDITION MADE BY THE ASSESSING OFFICER AND ALLOW DEDUCTION UNDER SECTION 80P(2) OF THE ACT. 6. THE APPELLANT PRAYS FOR LEAVE TO ADD, MODIFY, DELETE OR INTRODUCE ADDITIONAL GROUNDS OF APPEAL AT ANY TIME BEFORE THE APPEAL IS DISPOSED OFF. 2. DURING THE COURSE OF HEARING, THE LEARNED COUNSEL FOR THE ASSESSEE HAS CONTENDED THAT CIT(A) HAS DISMISSED THE APPEAL WITHOUT AFFORDING OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AFTER FIXING THE APPEAL ONLY FOR ONE DAY. IT WAS FURTHER CONTENDED THAT VARIOUS FACTS INVOLVED IN THIS CASE ARE REQUIRED TO BE EXAMINED IN THE LIGHT OF THE JUDGMENT OF THE APEX COURT IN THE CASE OF CITIZEN CO-OPERATIVE SOCIETY LTD., RECENTLY RENDERED BUT THE CIT(A) THOUGH MADE A REFERENCE OF THE JUDGMENT BUT DID NOT ADJUDICATE THE FACTS OF THE CASE IN THE LIGHT OF THE SAID JUDGMENT. THEREFORE, THE ORDER OF CIT(A) MAY BE SET ASIDE AND MATTER MAY BE RESTORED TO HIS FILE TO READJUDICATE THE APPEAL ON MERIT AFTER AFFORDING OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE LEARNED DR PLACED A RELIANCE UPON THE ORDER OF THE CIT(A). 3. HAVING HEARD THE RIVAL SUBMISSIONS AND FROM THE CAREFUL PERUSAL OF THE RECORD, WE FIND THAT THERE IS A DELAY OF 28 DAYS IN FILING OF APPEAL FOR WHICH AN ITA NOS. 2117 AND 2118/BANG/2018 PAGE 3 OF 3 APPLICATION HAS BEEN FILED FOR CONDONING THE DELAY. FINDING FORCE THEREIN, I CONDONE THE DELAY AND ADMIT THE APPEAL FOR HEARING. SO FAR AS MERIT IS CONCERNED, I FIND THAT CIT(A) HAS FIXED THE APPEAL FOR HEARING ONLY FOR ONE DAY AND DISMISSED THE APPEAL. THOUGH HE HAS MADE A REFERENCE ON THE JUDGMENT OF THE APEX COURT IN THE CASE OF CITIZEN CO-OPERATIVE SOCIETY LTD., BUT HE HAS NOT DISCUSSED THE FACTS OF THE CASE IN THE LIGHT OF AFORESAID JUDGMENTS AS CONTENDED BY THE ASSESSEE. I, THEREFORE, SET ASIDE THE ORDER OF THE CIT(A) AND RESTORE THE MATTER TO HIS FILE WITH A DIRECTION TO READJUDICATE THE ISSUES INVOLVED AFTER AFFORDING OPPORTUNITY OF BEING HEARD TO THE ASSESSEE IN THE LIGHT OF VARIOUS JUDGMENTS OF THE APEX COURT. 4. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 31 ST AUGUST, 2018. SD/ - SD/- (A. K. GARODIA ) (SUNIL KUMAR Y ADAV ) ACCOUNTANT M EMBER JUDICIAL MEMBER PLACE : BANGALORE DATED : 31/08/2018 /NS/* COPY TO : 1 APPELLANT 2 RESPONDENT 3 CIT 4 CIT(A) 5. DR 6 GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY INCOME- TAX APPELLATE TRIBUNAL BANGALORE