Shivprabha Nagar Sahakar Pathsanstha Ltd., Solapur V. Additional Commissioner of Income-tax,

ITA 2321/PUN/2016

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 3632 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 10 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-08-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2007-2008
• Appeal Filed On: 05-10-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: M K VERMA
• Keywords: Bad and doubtful debts

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, PUNE . , , , BEFORE SHRI D. KARUNAKARA RAO, AM AND SHRI VIKAS AWASTHY, JM . / ITA NO . 2 3 21 /P U N/201 6 / ASSESSMENT YEAR : 20 07 - 08 SHIVPRABHA NAGAR I S HAKARI PATHSANSTHA LTD., 2565, PANDEKAR, MATH, BARSHI, SOLAPUR 413401 PAN : AABAS7003H ....... / APPELLANT / V/S. ADDITIONAL COMMISSIONER OF INCOME TAX, RANGE 2, SOLAPUR / RESPONDENT ASSESSEE BY : SHRI PRAMOD SHINGTE REVENUE BY : SHRI M.K. VERMA / DATE OF HEARING : 08 - 08 - 201 8 / DATE OF PRONOUNCEMENT : 14 - 0 8 - 201 8 / ORDER PER VIKAS AWASTHY, JM : TH IS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF COMMI SSIONER OF INCOME TAX (APPEALS) - 7, PUNE DATED 25 - 07 - 2016 FOR THE ASSESSMENT YEAR 2007 - 08. 2 ITA NO . 2321/PUN/2016, A.Y. 2007 - 08 2. THE BRIEF FACTS OF THE CASE AS EMANATING FROM RECORD S ARE : THE ASSESSEE IS A CO - OPERATIVE SOCIETY ENGAGED IN PROVIDING CREDIT FACILITIES TO ITS MEMBERS AND ACCEPTING DEPOSITS. DURING THE COURSE OF SCRUTINY ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER MADE ADDITIONS / DISALLOWANCES ON ACCOUNT OF : I . PROVISION FOR BAD AND DOUBTFUL DEBTS ( NPA PROVISION) RS.24,12,37 2/ - II . ACCRUED INTEREST ON NPAS RS.10,48,173/ - . AGGRIEVED BY THE ADDITIONS/DISALLOWANCES MADE IN THE ASSESSMENT ORDER DATED 22 - 12 - 2009, THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS). THE COMMISSIONER OF INCOME TAX (APPEALS) DISMISSED THE APPEAL OF ASSESSEE. HENCE, THE ASSESS EE IS IN SECOND APPEAL BEFORE THE TRIBUNAL. 3. SHRI PRAMOD SHINGTE APPEARING ON BEHALF OF THE ASSESSEE SUBMITTED AT THE OUTSET THAT HE IS NOT PRESSING GROUND NO. 1 RAISED IN THE APPEAL WITH RESPECT TO DISALLOWANCE OF PROVISION FOR BAD AND DOUBTFUL DEBTS . 3.1 IN RESPECT OF GROUND NO. 2 OF THE APPEAL RELATING TO ADDITION ON ACCOUNT OF ACCRUED INTEREST ON NPAS , THE LD. AR SUBMITTED THAT THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE, BY THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF COMMISSIONE R OF INCOME TAX VS. M/S. DEOGIRI NAGARI SAHAKARI BAN K LTD. REPORTED AS 379 ITR 24. THE LD. AR SUBMITTED THAT THE CO - ORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF INCOME TAX OFFICER VS. MAHESH NAGARI SAHAKARI PAT SANSTHA LTD. IN ITA NO. 1874/PN/2012 FOR 3 ITA NO . 2321/PUN/2016, A.Y. 2007 - 08 AS SESSMENT YEAR 2009 - 10 DECIDED ON 25 - 03 - 2014 DELETED THE ADDITION MADE ON ACCOUNT OF ACCRUED INTEREST ON NPAS. 4. ON THE OTHER HAND MRS. SHWETA MISHRA REPRESENTING THE DEPARTMENT VEHEMENTLY SUPPORTED THE FINDINGS OF COMMISSIONER OF INCOME TAX (APPEALS) AND PRAYED FOR REJECTING THE GROUNDS RAISED BY THE ASSESSEE IN APPEAL. 5. BOTH SIDES HEARD. ORDERS OF THE AUTHORITIES BELOW PERUSED. THE LD. AR OF ASSESSEE HAS STATED AT THE BAR THAT HE IS NOT PRESSING GROUND NO. 1 OF THE APPEAL ASSAILING DISALLOWANC E OF NPA PROVISION RS.24,12,372/ - . IN VIEW OF THE STATEMENT MADE BY THE LD. AR , GROUND NO. 1 RAISED IN THE APPEAL IS DISMISSED AS NOT PRESSED. 6. THE GROUND NO. 2 OF APPEAL RELATES TO ADDITION MADE ON ACCOUNT OF ACCRUED INTEREST ON NPAS RS.10,48,173/ - . THE LD. AR PLACED RELIANCE ON THE DECISION OF HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF COMMISSIONER OF INCOME TAX VS. M/S. DEOGIRI NAGARI SAHAKARI BAN K LTD. (SUPRA) TO CONTEND THAT ACCRUED INTEREST ON NPAS IS NOT TO BE ADDED. WE FURTHER OBSERVE THAT THE PUNE BENCH OF THE TRIBUNAL IN THE CASE OF INCOME TAX OFFICER VS. MAHESH NAGARI SAHAKARI PAT SANSTHA LTD. (SUPRA) UPHELD THE DELETION OF ADDITION MADE ON ACCOUNT OF ACCRUED INTEREST OF NPAS IN THE CASE OF CREDIT CO - OPERATIVE SOCIETY. WE FIND MERIT IN THE SUBMISSIONS OF THE ASSESSEE IN THE LIGHT OF DECISIONS DISCUSSED ABOVE. THE HONBLE HIGH COURT IN THE AFOREMENTIONED CASE HA S UPHELD THE ORDER OF TRIBUNAL IN DELETING THE ADDITION ON ACCOUNT OF INTEREST ON STICKY ADVANCES. THE REVENUE HAS NOT 4 ITA NO . 2321/PUN/2016, A.Y. 2007 - 08 BROU GHT TO OUR NOTICE ANY CONTRARY JUDGMENT. THUS, THE ISSUE RAISED IN GROUND NO. 2 OF APPEAL BY THE ASSESSEE IS ALLOWED. 7. IN THE RESULT, THE APPEAL OF ASSESSEE IS PARTLY ALLOWED IN THE TERMS OF AFORESAID. ORDER PRONOUNCED ON TUESDAY, THE 14 TH DAY OF AUGUST, 201 8 . SD/ - SD/ - ( . /D. KARUNAKARA RAO ) ( / VIKAS AWASTHY) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE; / DATED : 14 TH AUGUST, 2018 RK / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 7 , PUNE 4. THE PR. CIT - 6 , PUNE 5. , , , / DR, ITAT, B BENCH, PUNE. 6. / GUARD FILE. / / // TRUE COPY// / BY ORDER, / PRIVATE SECRETARY, , / ITAT, PUNE