The BarodACITy Co.Op. Bank Ltd., Baroda V. The Dy.CIT, Circle-5, Baroda

ITA 2265/AHD/2014

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 8741 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-08-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2010-2011
• Appeal Filed On: 08-08-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V K SINGH
• Keywords: Bad and doubtful debts
• Section: 143(3); 145; 56

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, AHMEDABAD BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER AND SHRI MAHAVIR PRASAD, JUDICIAL MEMBER !# I.T.A. NO. 2265/AHD/2014 ( / ASSESSMENT YEAR : 2010-11) THE BARODA CITY CO.OP BANK LTD. SANSTHA VASAHAT, RAOPURA BARODA - 390001 # VS. DCIT CIRCLE 5 AAYAKAR BHAVAN, RACE COURSE CIRCLE, BARODA. $ # % & # PAN/GIR NO. : AAAAT 1465 D ( !$' / APPELLANT ) .. ( ($' # RESPONDENT ) !$') # APPELLANT BY : SHRI SAMIR PARIKH, A.R. ($'*) / RESPONDENT BY : SHRI V.K. SINGH, SR. D.R. + ,*-. / DATE OF HEARING 08/08/2017 /012*-. / DATE OF PRONOUNCEMENT 11/08/2017 3# O R D E R PER SHRI MAHAVIR PRASAD, JUDICIAL MEMBER : THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE OR DER OF THE COMMISSIONER OF INCOME TAX(APPEALS)-V, BARODA, DATE D 27/05/2014 IN THE MATTER OF ASSESSMENT UNDER SECTION 143(3) OF TH E INCOME TAX ACT, 1961 (THE ACT HEREINAFTER) FOR THE ASSESSMENT YEA R (AY) 2010-11, ON THE FOLLOWING GROUNDS:- I. LEARNED CIT(A) IS NOT CORRECT IN ADDITION NPA INTER EST OF RS.33,64,055/-. ITA NO. 2265/AH D/2015 THE BARODA CITY CO-OP VS. DCIT ASST.YEAR 2010-11 - 2 - II. THE ASSESSEE SUBMITS THAT INCOME IS NEVER ESCAPE FR OM INCOME TAX. IN RESPECT OF INTEREST ON NPA AS AND WHEN INCO ME ON SUCH ADVANCE IS RECEIVED IS OFFERED FOR INCOME TAX. IN A SSESSEES CASE, THE AMOUNT OF INTEREST OF RS.33,64,055/- WHICH THE LEARNED ASSESSING OFFICER BELIEVES THAT IT IS TO BE ACCOUNT ED AS INCOME ON ACCRUAL BASIS, IS ALREADY OFFERED FOR INCOME TAX IN NEXT SUBSEQUENT YEARS WHEN IT ACTUALLY RECEIVED TO THE B ANK. III. THE ASSESSEE IS GOVERNED BY PROVISIONS OF RBI AS PE R RBI GUIDELINES. INTEREST ON STICKY (NPA) ADVANCES IS TO BE RECOGNIZED ON RECEIPT BASIS. IV. ASSESSEE IS RELYING ON VARIOUS LEGAL PRONOUNCEMENTS WHICH ARE GIVEN AS UNDER: A. UNITED BANK OF INDIA VS. DEPUTY COMMISSIONER OF INC OME TAX ITAT CALCUTTA D BENCH (1999) 64 TTJ (CAL) 432 B. DEPUTY COMMISSIONER OF INCOME TAX VS. SYNDICATE BAN K & OTHERS ITAT BANGALORE BENCH (1995) 51 TTJ (BANG) 36 5 C. INCOME TAX OFFICER VS. ORIENTAL BANK OF COMMERCE LT D. ITAT DELHI B BENCH (1983) 3 ITD (DEL) 226 D. STATE BANK OF PATIALA VS. JOINT COMMISSIONER OF INC OME TAX ITAT, CHANDIGARH B BENCH (2008) 10 DTR (CHD) (TRI B) 527 ITA NO. 2265/AH D/2015 THE BARODA CITY CO-OP VS. DCIT ASST.YEAR 2010-11 - 3 - 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERI ALS ON RECORD ARE AS UNDER:- THE ASSESSEE IS A COOPERATIVE BANK ENGAGED IN THE BUSINESS OF BANKING. 2.2 DURING THE ASSESSMENT PROCEEDINGS, IT IS NOTICE D FROM THE BALANCE SHEET THAT, THE ASSESSEE HAS SHOWN NPA INTEREST AMO UNTING TO RS.36,09,23,510/- AND INTEREST ON INVESTMENTS AT RS .2,01,38,914/- UNDER THE HEAD OF INTEREST RECEIVABLE. AS PER SECTION 145 OF THE I.T. ACT A PERSON WHO IS FOLLOWING; MERCANTILE SYSTEM OF ACCOU NTING HAS TO SHOW THE INCOME ON ACCRUAL BASIS. HOWEVER, IT IS SEEN TH AT THE ASSESSEE HAS NOT SHOWN THE INTEREST ACCRUED ON NPA & INTEREST ON INV ESTMENTS IN THE PROFIT & LOSS ACCOUNT. THE ASSESSEE WAS ASKED TO SH OW CAUSE AS TO WHY THE ACCRUED INTEREST ON NPA & INTEREST ON INVESTMEN TS SHOULD NOT BE ADDED BACK TO THE TOTAL INCOME. IN RESPONSE TO SHOW-CAUSE NOTICE THE ASSESSEE VIDE ITS SUBMISSION DATED 08/02/2013 COMPLIED WITH AND SAME IS REPRODUC ED HEREUNDER: I. WE HAVE TO STATE THAT THE ASSESSEE IS A CO-OPERA TIVE BANK ADOPTING MERCANTILE SYSTEM OF ACCOUNTING ON ALL INC OMES EXCEPT INTEREST ON NON PERFORMING ASSETS (NPA) AS P ER RBI & ICAI DIRECTIVES. II. INTEREST RECEIVABLE ON INVESTMENTS IS ACCOUNTED ON MERCANTILE SYSTEM AND IS OFFERED FOR INCOME TAX. BA LANCE AMOUNTING TO RS.2,01,38,914/- IS ACCRUED INTEREST R ECEIVABLE ON INVESTMENTS WHICH IS RECEIVED IN SUBSEQUENT YEAR BUT INCOME IS ACCOUNTED IN CURRENT YEAR AND HENCE CANNO T BE TAXED TWICE. ITA NO. 2265/AH D/2015 THE BARODA CITY CO-OP VS. DCIT ASST.YEAR 2010-11 - 4 - III. SO FAR AS INTEREST RECEIVABLE ON NPA, BALANCE OF RS.36,09,23,510/- IS A TOTAL AMOUNT CUMULATED OVER A NUMBER OF YEARS. THIS AMOUNT IS NOT FOR THE CURRENT YEAR ONLY. HENCE YOUR PROPOSITION TO ADD THIS AMOUNT IN CURRENT YEAR IS INCORRECT. CURRENT YEAR INTEREST RECEIVABLE ON NPA IS OF RS.4,21, 73,387/- ONLY. COPY OF LEDGER ACCOUNT IS ENCLOSED HEREWITH. IV. WITHOUT PREJUDICE TO ABOVE, INTEREST INCOME ON NPA CANNOT BE TAXED ON THE BASIS OF ACCRUAL FOR THE FOLLOWING REASONS. A. THE ASSESSEE IS A CO-OPERATIVE BANK ENGAGED IN THE BUSINESS OF BANKING UNDER THE CONTROL OF RESERVE BA NK OF INDIA AND REGISTRAR OF CO-OPERATIVES, CO-OPERATIVE DEPARTMENT, GOVERNMENT OF GUJARAT. B. THE ASSESSEE BANK IS STATUTORILY REQUIRED TO FOLLOW ALL THE DIRECTIVES AND GUIDELINES ISSUED BY THE RESERVE BAN K OF INDIA AND CO-OPERATIVE DEPARTMENT, GOVERNMENT OF GUJARAT. C. AS PER MASTER CIRCULAR ON INCOME RECOGNITION, ASSE T CLASSIFICATION, PROVISIONING & OTHER RELATED MATTER S UPDATED UP TO 30 TH JUNE 2008 BY RESERVE BANK OF INDIA (COPY ENCLOSED), IT HAS LAID DOWN POLICY OF INCOME RECOGNITION WHICH INTER ALIA PROVIDES THAT'...... INCOME RECOGNITION HAS TO BE OBJECTIVE AND BASED ON THE RECORD OF RECOVERY. INCOME FROM NON-PERFORMING ASSETS (NPA ) IS NOT RECOGNIZED ON ACCRUAL BASIS BUT IS BOOKED AS INCOME ONLY 'WHEN IT IS ACTUALLY RECEIVED. THEREFORE, BANKS SHOULD NOT TAKE TO INCOME ACCOUNT INTEREST ON NON-PERFORMING ASSETS ON ACCRUAL BASIS.' ITA NO. 2265/AH D/2015 THE BARODA CITY CO-OP VS. DCIT ASST.YEAR 2010-11 - 5 - D. SECTION 66 OF THE GUJARAT CO-OPERATIVE SOCIETIES AC T, 1961 PROVIDES THAT (1) A SOCIETY EARNING PROFIT, SH ALL CALCULATE ITS ANNUAL NET PROFIT BY DEDUCTING FROM T HE GROSS PROFIT FOR THE YEAR, ALL ACCRUED INTEREST WHI CH IS OVERDUE FOR MORE THAN SIX MONTHS,. E. THUS TO FOLLOW THE DIRECTIVES OF THE RBI AND CO- OPERATIVE ACT PROVISION, THE ASSESSEE BANK IS ADOPT ING METHOD OF ACCOUNTING DIFFERENTLY FOR INTEREST ON NP A (STICKY LOANS) THAT OTHER INCOME. THE ASSESSES IS ADOPTING CASH SYSTEM OF ACCOUNTING FOR INTEREST INC OME ON AIL STICKY LOANS (NON PERFORMING ASSETS) AND FOR REST OF THE INTEREST IT FOLLOWS THE ACCRUAL SYSTEM OF ACCOUNTING. THIS METHOD OF ACCOUNTING IS CONSISTENT LY FOLLOWED BY THE ASSESSEE SINCE FROM LONG. F. WE SUBMIT THAT THE ABOVE METHOD OF ACCOUNTING IS AL SO RECOGNIZED BY THE INSTITUTE OF CHARTERED ACCOUNTANT S OF INDIA FOR BANKING INDUSTRIES. G. FURTHER, WE SUBMITS THAT INCOME IS NEVER ESCAPE FRO M INCOME TAX IN RESPECT OF INTEREST ON NPA AS WHEN EV ER INCOME ON SUCH ADVANCES IS RECEIVED IS, OFFERED FOR INCOME TAX. IN OUR CASE, THE AMOUNT OF INTEREST OF RS.4,21,73,387/- WHICH YOU ARE BELIEVING THAT IT IS TO BE ACCOUNTED AS INCOME ON ACCRUAL BASIS, IS ALREADY OF FERED FOR INCOME TAX IN NEXT SUBSEQUENT YEARS WHEN IT ACT UALLY RELEASED TO THE BANK. HENCE IN ANY CASE THERE IS NO INCOME WHICH ESCAPES FROM TAX AND IN TURN THERE IN NO DEDUCTION ALLOWED TO THE ASSESSEE WHICH IS PREJUDICIAL TO THE INTEREST O F THE REVENUE. H. IN SUPPORT OF THE ABOVE SUBMISSION, WE HAVE SUBMITT ED DOCUMENTS PERTAINING TO INTEREST ON STICKY LOANS WH ICH ITA NO. 2265/AH D/2015 THE BARODA CITY CO-OP VS. DCIT ASST.YEAR 2010-11 - 6 - WERE NOT OFFERED FOR INCOME TAX IN EARLIER ASSESSME NT YEARS ON THE BASIS OF ACCRUAL BUT IS OFFERED FOR TA X IN A.Y.2010-11 ON THE BASIS OF ITS ACTUAL RECOVERY. I. BASED ON THE ABOVE SUBMISSION, WE RESPECTFULLY SUBM ITS THAT INTEREST INCOME ON NPA CANNOT BE TAXED ON ACCR UAL BASIS. THE ASSESSEE FURTHER SUBMITTED THE SUBMISSION VIDE LETTER DATED 13/03/2013 STATING THAT IN CONTINUANCE TO OUR EARLIER REPLY, WE HAVE TO FURTHER, SUBMIT THAT OUT OF TOTAL NPA INTEREST AMOU NTING TO RS.4,21,73,387/-, INTEREST OF RS.33,64,055/- IS REL ATING TO NPA ACCOUNTS WHICH ARE CLASSIFIED AS NPA WITHIN THREE YEARS AND REST OF THE INTEREST IS RELATING TO NPA ACCOUNTS WHICH ARE CLASSIFIED AS NP A FOR MORE THAN THREE YEARS. LIST OF NPA INTEREST BELOW THREE YEARS AND ABOVE THREE YEARS IN ENCLOSED HEREWITH. 2.3 LEARNED ASSESSING OFFICER WAS NOT CONVINCED WIT H THE SUBMISSION OF THE ASSESSEE AND STATED THAT ASSESSEE ADOPTING M ERCANTILE SYSTEM OF ACCOUNTING, EXCEPT FOR INTEREST ON NON-PERFORMING A SSETS (NPA). AS PER SECTION 145 OF THE ACT, ASSESSEE WAS REQUIRED TO FO LLOWING EITHER CASH OR MERCANTILE SYSTEM OF ACCOUNTING. MIXED/HYBRID ACCOU NTING SYSTEM WAS DISPENSES WITH FROM A.Y.1997-98. HENCE, ASSESSEE WA S REQUIRED TO RECOGNIZE INCOME ON ACCRUAL BASIS. THE ASSESSEE HAS CONFIRMED THAT OUT OF TOTAL NPA INTEREST AMOUNTING TO RS.4,21,73,387/- , INTEREST OF RS.33,64,055/- IS RELATING TO NPA ACCOUNTS WHICH AR E CLASSIFIED AS NPA ITA NO. 2265/AH D/2015 THE BARODA CITY CO-OP VS. DCIT ASST.YEAR 2010-11 - 7 - WITHIN THREE YEARS AND REST OF THE INTEREST IS RELA TING TO NPA ACCOUNTS WHICH ARE CLASSIFIED AS NPA FOR MORE THAN THREE YEA RS. IT IS PERTINENT TO MENTION HERE THAT THE BOARDS INSTRUCTIONS ON BAD A ND DOUBTFUL DEBTS/IRRECOVERABLE LOANS INTEREST THEREON SUSP ENSE ACCOUNT MAINTAINED FOR THE PURPOSE OF VIDE CIRCULAR : F. NO.201/21/84-ITA-II , DATED 09/10/1984, IN WHICH IT HAS BEEN CLEARLY INST RUCTED THAT IT HAS BEEN DECIDED THAT INTEREST IN RESPECT OF DOUBTFUL DEBTS CREDITED TO SUSPENSE ACCOUNT BY THE BANKING COMPANIES WILL BE SUBJECT TO TAX BUT INTEREST CHARGED IN AN ACCOUNT WHERE THERE HAS BEEN NO RECOV ERY FOR THREE CONSECUTIVE ACCOUNTING YEARS WILL NOT BE SUBJECTED TO TAX IN THE FOURTH YEAR AND ONWARDS. HOWEVER, IF THERE IS ANY RECOVERY IN THE FOURTH YEAR ON LATER, THE ACTUAL AMOUNT RECOVERED ONLY WILL BE SUB JECTED TO TAX IN THE RESPECTIVE YEARS. THIS PROCEDURE WILL APPLY TO THE ASSESSMENT YEAR 1979- 80 AND ONWARDS. THE BOARDS INSTRUCTION NO.1186, DA TED 22/06/1978 IS MODIFIED TO THAT EXTENT. 2.4 IN VIEW OF THE ABOVE, THE AMOUNT OF RS.33,64,05 5/- WAS REQUIRED TO CREDIT TO THE PROFIT AND LOSS ACCOUNT. HOWEVER, IT WAS NOT CREDITED TO THE PROFIT AND LOSS ACCOUNT. FURTHER, IT WAS NOT CONSID ERED FOR COMPUTING THE PROFIT AND GAINS OF BUSINESS OR PROFESSION TO O. SINCE, ASSESSEE FOLLOWED MERCANTILE SYSTEM OF ACCOUNTING, THE INTER EST OF RS.33,64,055/- ACCRUED AS INTEREST OF NPA, SHOULD HAVE BEEN INCLUD ED IN THE TOTAL INCOME BY VIRTUE OF THE PROVISIONS OF SECTION 145 OF THE ACT, WHICH WAS NOT DONE. AS SUCH, THE ASSESSEE IN VIOLATION OF P ROVISIONS OF SECTION 145 ITA NO. 2265/AH D/2015 THE BARODA CITY CO-OP VS. DCIT ASST.YEAR 2010-11 - 8 - OF THE IT ACT HAD NOT SHOWN THE INTEREST INCOME OF RS.33,64,055/- IN THE RETURN OF INCOME AND HAS NOT OFFERED FOR TAXATION. HENCE, INTEREST ON NPA AMOUNTING TO RS.33,64,055/- IS ADDED BACK TO THE TO TAL INCOME OF THE ASSESSEE. LEARNED AO FURTHER HELD THAT ASSESSEE IS CONCEALED THE INTEREST ON NPA, HENCE, PENALTY PROCEEDINGS U/S.271(1)(C) OF THE IT ACT IS INITIATED AND ADDITION OF RS.33,64,055/- WAS MADE A GAINST THE ASSESSEE. 3. AGAINST THE SAID ORDER ASSESSEE PREFERRED FIRST STATUTORY APPEAL BEFORE THE LEARNED CIT(A) BUT LEARNED CIT(A) DISMIS SED THE APPEAL OF THE ASSESSEE. 4. NOW MATTER IS BEFORE US. 5. WE HAVE GONE THROUGH THE RELEVANT RECORD AND IMP UGNED ORDER PASSED BY THE AUTHORITIES BELOW. LEARNED AR CITED A JUDGMENT OF JURISDICTIONAL HIGH COURT [2016] 72 TAXMANN.COM 117 (GUJARAT), PRINCIPAL COMMISSIONER OF INCOME TAX 5 VS. SHRI MAHILA SEWA SAHAKARI BANK LTD., IN THIS CASE HONBLE HIGH COURT HAS HELD AS U NDER: SECTION 5, READ WITH SECTION 145, OF THE INCOME TA X ACT, 1961, READ WITH SECTION 45Q, OF THE RESERVE BANK OF INDIA ACT, 1934 AND SECTION 5, READ WITH SECTION 56 OF THE BANKING REGULATION ACT, 1949 INCOME ACCRUAL OF (INTEREST) ASSESSMENT YEAR 2010-11- AS SESSEE, A CO- OPERATIVE BANK FILED ITS RETURN OF INCOME FOR RELEV ANT YEAR BUT DID NOT SHOW INTEREST INCOME ON NON-PERFORMING ASSETS (NPAS ) AS ACCORDING TO ASSESSEE IT WAS NOT REALIZABLE ASSESSING OFFICER, HOWEVER, ADDED INTEREST AS INCOME OF ASSESSEE HOLDING THAT IT HAD ACCRUED TO ASSESSEE EVEN IF IT WAS NOT ACTUALLY REALIZED AS IT WAS FOLL OWING MERCANTILE SYSTEM ITA NO. 2265/AH D/2015 THE BARODA CITY CO-OP VS. DCIT ASST.YEAR 2010-11 - 9 - OF ACCOUNTING WHETHER EXPRESSION BANKING COMPANY HAS BEEN DEFINED UNDER SECTION 5(C) OF BANKING REGULATION AC T, 1949 TO MEAN ANY COMPANY WHICH TRANSACTS BUSINESS OF BANKING IN INDI A HELD, YES WHETHER IN VIEW OF CLAUSE (A) OF SECTION 56 OF 1949 ACT, EXPRESSION BANKING COMPANY WOULD TAKE WITHIN ITS SWEEP A CO- OPERATIVE BANK HELD, YES WHETHER THEREFORE, ASSESSING OFFICER WA S NOT JUSTIFIED IN HOLDING THAT CBDTS CIRCULAR F. NO.201/21/84-ITA-II , DATED 09/10/1984 (REGARDING NON-TAXABILITY OF INTEREST NO T RECEIVED FOR THREE YEARS) APPLIES ONLY TO BANKING COMPANIES AND NOT TO CO-OPERATIVE BANKS HELD, YES WHETHER TWIN FACTORS COME INTO PLAY WHI LE DETERMINING TAX LIABILITY, NAMELY, INCOME RECOGNITION AND COMPUTATI ON AND INSOFAR AS INCOME RECOGNITION IS CONCERNED, IT WOULD BE RBI DI RECTIONS WHICH WOULD PREVAIL IN VIEW OF PROVISIONS OF SECTION 45Q OF RBI ACT AND SECTION 145 WOULD HAVE NO ROLE TO PLAY HELD, YES WHETHER IN VIEW OF MANDATE OF RBI ACT AND SECTION 145 WOULD HAVE NO RO LE TO PLAY HELD, YES WHETHER IN VIEW OF MANDATE OF RBI GUIDELINES, ASSESSEE COULD NOT HAVE RECOGNIZED INCOME ONLY WHEN IT WAS ACTUALLY RE CEIVED HELD, YES WHETHER THEREFORE, INTEREST ON NPAS WOULD NOT BE TAXABLE ON ACCRUAL BASIS IN ASSESSEES HANDS HELD, YES [PARAS 20, 23 , 30 & 31] [IN FAVOUR OF ASSESSEE] IN THE LIGHT OF THE VIEW ADOPTED BY THE COURT, ENT ER INTO ANY DETAILED DISCUSSION AS REGARDS THE APPLICABILITY OR OTHERWISE OF THE CBDT CIRCULAR TO THE FACTS OF THE INSTANT CASE. THE SUPR EME COURT IN UCO BANK VS. CIT[1999] 237 ITR 889/104 TAXMANN 547 HAS HELD THAT SUCH CIRCULARS ARE NOT MEANT FOR CONTRADICTING OR NULLIF YING ANY PROVISION OF THE STATUTE. THEY ARE MEANT FOR PROPER ADMINISTRATI ON OF THE STATUTE, THEY ARE DESIGNED TO MITIGATE THE RIGOURS OF THE APPLICA TION OF A PARTICULAR PROVISION OF THE STATUTE IN CERTAIN SITUATIONS BY A PPLYING A BENEFICIAL INTERPRETATION TO THE PROVISION IN QUESTION SO AS T O BENEFIT THE ASSESSEE AND MAKE THE APPLICATION OF THE FISCAL PROVISION, I N THAT CASE, IN ITA NO. 2265/AH D/2015 THE BARODA CITY CO-OP VS. DCIT ASST.YEAR 2010-11 - 10 - CONSONANCE WITH THE CONCEPT OF INCOME AND IN PARTIC ULAR, NOTIONAL INCOME AS ALSO THE TREATMENT OF SUCH NOTIONAL INCOM E UNDER THE ACCOUNTING PRACTICE. THE COURT, ACCORDINGLY, DID NO T FIND ANY INCONSISTENCY OR CONTRADICTION BETWEEN THE CIRCULAR SO ISSUED AND SECTION 145 OF THE INCOME-TAX ACT. IN THE AFORESAID PREMISE , UNTIL THE CIRCULAR IS REVOKED, THE SAME CONTINUES TO BE IN FORCE AND THE SAME HAVING BEEN ISSUED TO MITIGATE THE HARDSHIPS CAUSED TO THE CLAS S OF ASSESSEES COVERED BY THE CIRCULAR, SUCH ASSESSEES WOULD BE ENTITLED T O THE BENEFIT THEREOF. MERELY BECAUSE BY VIRTUE OF THE PROVISIONS OF SECTI ON 43D, A CERTAIN CLASS OF ASSESSEES IS GIVEN BENEFIT UNDER THE PROVISIONS OF THE ACT WOULD NOT MEAN THAT THE SAME WOULD OVERRIDE THE CIRCULAR. RESPECTFULLY FOLLOWING THE JUDGMENT OF JURISDICTION AL HIGH COURT, WE SET ASIDE THE FINDING OF THE LEARNED CIT AND DIR ECT THE AO TO DELETE THE IMPUGNED ADDITION. 6. SO FAR AS LEARNED CIT(A) SHOULD NOT HAVE ADDED T HE NPA INTEREST OF RS.33,64,055/-. 6.2 SO FAR AS GROUND NO.2 IS CONCERNED, IT DOES NOT REQUIRED ANY SEPARATE ADJUDICATION. 6.3 GROUND NO.3 HAS ALREADY BEEN DEALT IN DETAIL. ITA NO. 2265/AH D/2015 THE BARODA CITY CO-OP VS. DCIT ASST.YEAR 2010-11 - 11 - 6.4 IN OUR OBSERVATION IN GROUND NO.4, VARIOUS LEGA L PRONOUNCEMENTS AND IT DOES NOT REQUIRE ANY SEPARATE ADJUDICATION. 7. IN VIEW OF THE ABOVE, APPEAL OF THE ASSESSEE IS ALLOWED. THIS ORDER PRONOUNCED IN OPEN CO URT ON 11 / 0 8 /201 7 SD/- SD/ - ( ) 4 5 ( N.K. BILLAIYA ) ( MAHAVIR PRASAD ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 11/08/2017 PRITI YADAV, SR.PS !'#$ %$' # COPY OF THE ORDER FORWARDED TO : 1. !$' / THE APPELLANT 2. ($' / THE RESPONDENT. 3. 67- + 8- / CONCERNED CIT 4. + 8- 4!5 / THE CIT(A)-V, BARODA. 5. 9:;-67 !.!672 ! / DR, ITAT, AHMEDABAD 6. ;<=, # GUARD FILE. & ' / BY ORDER, (9-- //TRUE COPY// (/' )* ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD TRUE COPY