M/s. Shreerama Credit Co-operative Society Limited, Udupi V. Income Tax Officer, Ward- 2, Udupi

ITA 233/BANG/2020

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 7389 (ITAT-BANGALORE)
• Duration Of Justice: 1 year(s) 1 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-04-2021
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 06-04-2021
• Assessment Year: 2014-2015
• Appeal Filed On: 24-02-2020
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: N O N E
• Keywords: Opportunity of being heard
• Section: 201

Judgement Text

ITA NO.233/BANG/2020 M/S. SHREERAMA CREDIT CO-OP. SOCIETY LTD., UDUPI IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH: BANGALORE BEFORE SHRI CHANDRA POOJARI , ACCOUNTANT MEMBER SMC ITA NO.233/BANG/2020 ASSESSMENT YEAR: 2014-15 M/S. SHREERAMA CREDIT CO-OP. SOCIETY LTD. SHANKAR SHET TOWERS KUNDAPURA UDUPI DISTRICT 576 201 PAN NO : AAAJS1565Q VS. ITO WARD-2 ADI-UDUPI MALPE ROAD UDUPI DISTRICT-576103 APPELLANT RESPONDENT APPELLANT BY : N O N E RESPONDENT BY : SHRI GANESH R. GHALE, STANDING COUNSEL DATE OF H EARING : 06.04.2021 DATE OF PRONOUNCEMENT : 06.04.2021 O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST ORDER OF THE CIT(A) DATED 9.1.2020. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: 1. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE ASS ESSING OFFICER AND THE APPELLATE AUTHORITY ERRED IN DENYING THE BENEFIT OF DEDUCTION UNDER SEC.80P(2) OF THE INCOME TAX ACT, 1961 TO THE APPEL LANT. 2. BOTH THE AUTHORITIES BELOW ERRED IN APPLYING THE DE CISION RENDERED BY THE HONBLE APEX COURT IN THOTGARS SALE CO-OPERATIVE SO CIETY LTD. VS. ITO FOR DENYING THE BENEFIT OF DEDUCTION UNDER SEC.80P(2) O F THE I.T. ACT TO THE APPELLANT IN RESPECT OF THE INTEREST ON INVESTMENTS EARNED BY THE APPELLANT FROM SCHEDULED BANKS AMOUNTING TO RS.9,70,324/-. ITA NO.233/BANG/2020 M/S. SHREERAMA CREDIT CO-OP. SOCIETY LTD., UDUPI PAGE 2 OF 3 3. THE APPELLANT CRAVES LEAVE TO ADD, TO AMEND, MODIFY AND/OR TO ALTER ANY OF THE FOREGOING GROUNDS AND ALSO URGE SUCH OTHER GROU NDS AT THE TIME OF HEARING. 2. FACTS OF THE CASE ARE THAT THE ASSESSEE IS A CO- OPERATIVE SOCIETY ENGAGED IN CARRYING ON BUSINESS OF PROVIDING CREDIT FACILITIES TO ITS MEMBERS AND NOT CARRYING ON ANY OTHER ACTIVITIES. THE ASSESSEE HAS RECEIVED INTER-ALIA INTEREST INCOME FROM FOLLOWING BANKS: I. AXIS BANK - RS.16,766/- II. SBI - RS.9,53,558/- TOTAL INTEREST EARNED BY ASSESSEE WAS RS.70,23,462 /- AND THERE WAS A BUSINESS LOSS OF RS.10,61,306/-. ASSES SEE CLAIMED SET OFF OF BUSINESS LOSS ON THE INCOME. ASSESSEE CLAIM ED DEDUCTION U/S 80(2)(D) OF THE INCOME-TAX ACT,1961 ['THE ACT' FOR SHORT] AT RS.59,62,261/-, WHICH WAS GRANTED BY A.O. ASSESSE E ALSO CLAIMED DEDUCTION U/S 80P(2)(A)(I) OF THE ACT ON THE INCOME EARNED BY INTEREST AT RS.9,70,324/- U/S 80P(2)(A)(I) OF THE ACT. THIS WAS DENIED BY LOWER AUTHORITIES ON THE REASON THAT THIS DEDUCTION COULD BE ALLOWABLE ONLY ON INCOME EARNED BY INTEREST OR DIVI DEND BY THE CO- OPERATIVE SOCIETY FROM ITS INVESTMENT WITH ANY OTHE R CO-OPERATIVE SOCIETY NOT WITH BANK BY PLACING RELIANCE ON THE JU DGEMENT OF HONBLE SUPREME COURT IN THE CASE OF TOTAGARS CO-OPERATIVE SALE SOCIETY LTD. VS. ITO 322 ITR 283. AGAIN THE ASSESSEE IS IN APPE AL BEFORE US. 3. I HAVE HEARD THE D.R. SUBMISSIONS, PERUSED THE M ATERIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. NONE APPEARED FOR THE ASSESSEE. I AM OF TH E OPINION THAT SIMILAR ISSUE CAME FOR CONSIDERATION BEFORE B BEN CH BENGALURU IN ITA NO.287/BANG/2019 FOR THE ASSESSMENT YEAR 2014-1 5 IN WHICH THE TRIBUNAL VIDE ORDER DATED 26.7.2019 HELD AS UND ER: WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND WE SE T ASIDE THE ORDER OF CIT(A) AND RESTORE THE MATTER BACK TO HIS FILE FOR FRESH DECISION IN THE LIGHT OF ABOVE DISCUSSION, BY WAY O F A SPEAKING AND ITA NO.233/BANG/2020 M/S. SHREERAMA CREDIT CO-OP. SOCIETY LTD., UDUPI PAGE 3 OF 3 REASONED ORDER AFTER PROVIDING ADEQUATE OPPORTUNITY OF BEING HEARD TO BOTH SIDES. THE LD. CIT(A) IS DIRECTED TO PASS A SPEAKING AND REASONED ORDER AFTER COMPARING THE FACTS OF PRESENT CASE WITH THE FACTS IN THE CASE OF THE CITIZEN CO-OPERATIVE SOCIE TY LTD. VS. ACIT 397 ITR 1 (SC). HE IS ALSO DIRECTED TO EXAMINE THE FACTS OF PRESENT CASE IN THE LIGHT OF THESE TWO JUDGEMENTS OF HONBL E KARNATAKA HIGH COURT RENDERED IN THE CASE OF TUMKUR MERCHANTS SOUH ARDA CREDIT CO-OPERATIVE LTD. VS. ITO 230 TAXMAN 309 AND PCIT A ND ANOTHER VS. TOTAGARS CO-OPERATIVE SALE SOCIETY (SUPRA) AND PASS NECESSARY ORDER AS PER LAW IN THE LIGHT OF ABOVE DISCUSSION A FTER PROVIDING ADEQUATE OPPORTUNITY OF BEING HEARD TO BOTH SIDES. 4. RESPECTFULLY FOLLOWING THE ABOVE ORDER OF THE T RIBUNAL, WE REMIT THIS ISSUE TO THE FILE OF THE A.O. FOR SIMILAR DIRE CTION. ACCORDINGLY, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATIS TICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 6 TH APR, 2021 (CHANDRA POOJARI) ACCOUNTANT MEMBER BANGALORE, DATED 6 TH APR, 2021. VG/SPS COPY TO: 1. THE APPLICANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER ASST. REGISTRAR, ITAT, BANGALORE.