IDBI BANK LTD, MUMBAI V. ACIT LTU, MUMBAI

ITA 2193/MUM/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 3042 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 2 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-06-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: I
• Next Hearing Date: 07-12-2015
• Assessment Year: 2004-2005
• Appeal Filed On: 19-03-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B C S NAIK; BHANWAR SINGH RATNOO
• Section: 14A; 115JB; 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL I BENCH, MUMBAI BEFORE SHRI R. C. SHARMA , ACCOUNTANT MEMBER AND SHRI PAWAN SINGH, JUDICIAL MEMBER ./ I.T.A. NO. 2193/M UM/2013 ( / ASSESSM ENT YEAR: 2004 - 05 ) IDBI BANK LTD. IDBI TOWER, WTC COMPLEX, 7 TH FLOOR, TAXATION CELL, CUFFEE PARADE, MUMBAI - 400 005 / VS. ASST. CIT, LARGE TAX PAYERS UNIT, 28 TH FLOOR, CENTRE - 1, WTC COMPLEX, CUFFE PARADE, MUMBAI - 400 005 ./ ./ PAN/ GIR NO. AAACI 1105 R ( / APPELLANT ) : ( / RESPONDENT ) / APPELLANT BY : SHRI SATISH MODI / RESPONDENT BY : SHRI B. C. S. NAIK & SHRI BHANWAR SINGH RATNOO / DATE OF HEARIN G : 16.3.2016 / DATE OF PRONOUNCEMENT : 16 . 6.2016 / O R D E R PER R. C. SHARMA , A. M.: THIS IS AN A PPEAL FILED BY THE ASSESSEE AGAINST THE O RDER BY THE LD. CIT(A) - 24 , MUMBAI DATED 12.12.2012 FOR THE ASSESSMENT YEAR (A.Y.) 2004 - 05 , IN THE MATTER OF ORDER PASSED U/S.143(3) R/W S. 147 OF THE INCOME TAX ACT, 1961 . 2. IN THE GROUND SO RAISED, THE ASSESSEE IS AGGRIEVED FOR REOPENING AS WELL AS MERIT OF THE DISALLOWANCE MADE U/S. 14A WHILE COMPUTING BOOK PROFIT U/S.115JB OF THE ACT. THE ASSESSEE IS ALSO AGGRIEVED FOR INTEREST LEVIED U/S. 234D OF THE ACT. 2 ITA NO. 2193/MUM/2013 (A.Y. 2004 - 05) IDBI BANK LTD. VS. ASST. CIT 3. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORD PERUSED. FACTS OF THE CASE IN BRIEF ARE THAT THE ASSESSEE IS A BANKING COMPANY. ORIGINAL ASSESSMENT WAS COMPLETED U/S. 143(3), THEREAFTER , AFTER PASSING OF FOUR YEARS ASSESSMENT WAS REOPENED. AS PER OUR CONSIDERED VIEW , THE ASSESSMENT CAN BE REOPENED U/S. 147 OF THE IT ACT, 1961 AFTER A PERIOD OF FOUR YEARS FROM THE END OF THE ASSESSMENT YEAR ON THE GROUND THAT THERE WAS A FAILURE ON THE PA RT OF THE ASSESSEE TO FULLY AND TRULY DISCLOSURE ALL THE MATERIAL FACTS. HOWEVER, THE ASSESSING OFFICER WHILE RECORDING REASONS HAS NOT STATED ANYWHERE IN THE REASONS FOR REOPENING THAT THERE IS ANY FAILURE ON PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRU LY ALL THE MATERIAL FACT. FURTHER MORE IN ONE OF THE REASONS RECORDED FOR A.Y. 2004 - 05 REGARDING THE APPLICABILITY OF SECTION 40(A)(IA) OF THE ACT FOR NON DEDUCTION OF TAXES ON M I CR PAYMENT IS NOT APPLICABLE TO THE ASSESSEE AS PROVISIONS OF SECTION 40(A)(I A) OF THE ACT ARE APPLICABLE FROM A.Y. 2005 - 06. THIS SHOWS THAT THERE IS COMPLETE NON - APPLICATION OF MIND BY THE ASSESSING OFFICER WHILE RECORDING THE REASONS FOR REOPENING THE ASSESSMENT. WHILE RECORDING THE REASONS RECORDED, THE ASSESSING OFFICER HAS TO SPECIFY, WHICH MATERIAL FACT HAS NOT BEEN D ISCLOSED BY THE ASSESSEE. HENCE IN THE INSTANT CASE REOPENING ITSELF IS BAD IN LAW. 4. WE FOUND THAT THE REOPENING FOR A.Y. 2005 - 06 WAS ALSO HELD TO BE BAD IN LAW BY THE TRIBUNAL VIDE ITS ORDER DATED 30.3.2016. AS THE FACTS AND CIRCUMSTANCES ARE THE SAME, RESPECTFULLY FOLLOWING THE ORDER OF THE TRIBUNAL IN THE ASSESSEES OWN CASE WE DO NOT FIND ANY MERIT FOR REOPENING THE COMPLETED ASSESSMENT AFTER THE PERIOD OF FOUR YEARS WHEN THERE IS NO FAILURE ON THE PART OF THE ASSESSEE TO FULLY AND TRULY DISCLOSE ALL THE MATERIAL FACTS. 5. NOW COMING TO THE MERITS. SINCE THE ASSESSEE IS A BANKING COMPANY THE PROVISIONS OF SECTION 115JB WAS NOT APPLICABLE TO A BANKING COMPANY , HENCE NO INCOME IS ASSESSABLE U/S.115JB. THE SAI D SECTION HAS BEEN EXTENDED TO OTHER ASSESSEES LIKE BANKS, INSURANCE COMPANIES, ETC. ALSO AS PER THE AMENDMENT MADE BY FINANCE ACT, 2012. IN THE 3 ITA NO. 2193/MUM/2013 (A.Y. 2004 - 05) IDBI BANK LTD. VS. ASST. CIT FOLLOWING CASES, IT HAS BEEN HELD THAT SECTION 115JB IS NOT APPLICABLE TO BANKS AND OTHER COMPANIES WHOSE ACC OUNTS ARE NOT MADE AS PER SECTION 211 OF THE COMPANIES ACT. 1. CANARA BANK VS. CIT (LTU), ITAT BANGALORE [ITA NO. 305/BANG/2011] 2. DENA BANK VS. ACIT (2)(3), ITAT MUMBAI [ITA NO. 4325/M/2011 & 1600/M/2012] 3. KRUG THAI BANK PCL VS. JDIT (INTERNATIONAL TAXATION) ITAT MUMBAI [(2011) 16 TAXMANN.COM] 4. UNION BANK OF INDIA VS. ACIT, ITAT MUMBAI [ITA NO.4702 TO 4706/MUM/2010] 5. INDUSIND BANK LTD. VS. ADDL. CIT, ITAT MUMBAI [ITA NO. 2921/MUM/2012] 6. IN VIEW OF THE ABOVE, WE DO NOT FIND ANY MERIT FOR THE ADDITION MADE U/S. 115JB OF THE ACT. 7. WITH REGARD TO THE LEVY OF INTEREST U/S. 234D, IT IS THE CASE OF THE REASSESSMENT U/S. 147, INTEREST U/S. 234D IS APPLICABLE ONLY WHEN REFUND IS GRANTED TO THE ASSESSEE U/S. 143(1) AND NO REFUND IS DUE ON REGULAR ASSESSMENT OR REFUND GRANTED EXCEEDS THE AMOUNT REFUNDABLE ON REGULAR ASSESSMENT. SINCE THE ORIGINAL ASSESSMENT WAS COMPLETED U/S. 143(3), THE PROVISIONS OF SECTION 234D IS NOT APPLICABLE TO THE INSTANT ASSESSEE. 8. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON J UNE 16 , 201 6 SD/ - SD/ - ( PAWAN SINGH ) ( R. C. SHARMA ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER / MUMBAI ; / DATED : 16 . 0 6 .201 6 . . ./ ROSHANI , SR. PS 4 ITA NO. 2193/MUM/2013 (A.Y. 2004 - 05) IDBI BANK LTD. VS. ASST. CIT / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESP ONDENT 3. ( ) / THE CIT(A) 4. / CIT - CONCERNED 5. , , / DR, ITAT, MUMBAI 6. / GUARD F ILE / BY ORD ER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI