ACIT Circle 1, Vellore V. The Tiruvannamalai District Central co-op. Bank Ltd., Tiruvannamalai

ITA 2477/CHNY/2017

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 8329 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 2 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-01-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2014-2015
• Appeal Filed On: 10-10-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: HOMI RAJVANSH
• Assessee Lawyers: K RAVI

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI . . . , . !', $ '% BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI S. JAYARAMAN, ACCOUNTANT MEMBER ./ ITA NO.2503/CHNY/2017 ' (' / ASSESSMENT YEAR : 2013-14 M/S THE TIRUVANNAMALAI DISTRICT CENTRAL CO-OPERATIVE BANK LTD., COLLECTORATE MASTER COMPLEX, TIRUVANNAMALAI 606 604. PAN : AAATT 4448 F V. THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1, VELLORE. (*+/ APPELLANT) (,-*+/ RESPONDENT) ./ ITA NOS.2476 & 2477/CHNY/2017 ' (' / ASSESSMENT YEARS : 2013-14 & 2014-15 THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1, VELLORE. V. M/S THE THIRUVANNAMALAI DISTRICT CENTRAL CO-OPERATIVE BANK LTD., NO.9, 6 TH STREET, GANDHI NAGAR, THIRUVANNAMALAI 606 602. (*+/ APPELLANT) (,-*+/ RESPONDENT) './0 1 /ASSESSEE BY : SHRI K. RAVI, ADVOCATE !0 1 /REVENUE BY : SHRI HOMI RAJ VANSH, CIT 2 0 /$ / DATE OF HEARING : 19.12.2018 34( 0 /$ / DATE OF PRONOUNCEMENT : 02.01.2019 2 I.T.A. NO.2503/CHNY/17 I.T.A. NOS.2476 & 2477/CHNY/ 17 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER : BOTH THE ASSESSEE AND REVENUE HAVE FILED APPEALS AGAINST THE RESPECTIVE ORDERS OF THE COMMISSIONER OF INCOME TAX (APPEALS)-13, CHENNAI, FOR THE ASSESSMENT YEAR 2013-14. THE REVE NUE HAS FILED ONE MORE APPEAL FOR ASSESSMENT YEAR 2014-15. SINCE COM MON ISSUE ARISES FOR CONSIDERATION IN ALL THESE APPEALS, WE HEARD TH ESE APPEALS TOGETHER AND DISPOSING OF THE SAME BY THIS COMMON ORDER. LETS FIRST TAKE THE ASSESSEES APPEAL IN I.T.A. NO.2503/CHNY/2017 FOR ASSESSMENT YEAR 2013-14. 2. THE FIRST GROUND ARISES FOR CONSIDERATION IS DIS ALLOWANCE OF 2,52,000/- TOWARDS RENT PAID, UNDER SECTION 40(A)(I A) OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT'). 3. DURING THE COURSE OF HEARING, SHRI K. RAVI, THE LD.COUNSEL FOR THE ASSESSEE, SUBMITTED THAT HE IS NOT PRESSING THIS IS SUE. MOREOVER, ADMITTEDLY, THE ASSESSEE HAS NOT DEDUCTED TAX AS REQUIRED UNDER THE ACT. THEREFORE, THE DISALLOWANCE HAS TO BE MADE. IN VIEW OF THE ABOVE, THIS TRIBUNAL DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE LOWER AUTHORITY AND ACCORDINGLY THE SAME IS CONFIRMED. 3 I.T.A. NO.2503/CHNY/17 I.T.A. NOS.2476 & 2477/CHNY/ 17 4. THE NEXT GROUND ARISES FOR CONSIDERATION IS WITH REGARD TO COMPUTATION OF TOTAL INCOME FOR THE PURPOSE OF DEDU CTION UNDER SECTION 36(1)(VIIA) OF THE ACT. 5. SHRI K. RAVI, THE LD.COUNSEL FOR THE ASSESSEE, S UBMITTED THAT AN IDENTICAL ISSUE WAS CONSIDERED BY THIS TRIBUNAL IN THE CASE OF INDIAN OVERSEAS BANK IN I.T.A. NO.248/MDS/2010 BY AN ORDER DATED 05.03.2013. THIS TRIBUNAL, ACCORDING TO THE LD. COUNSEL, FOUND THAT THE BROUGHT FORWARD LOSSES WOULD NOT BE DEDUCTED WHILE COMPUTIN G THE TOTAL INCOME FOR THE PURPOSE OF SECTION 36(1)(VIIA) OF THE ACT. IN FACT, THIS TRIBUNAL PLACED ITS RELIANCE ON THE EARLIER ORDER IN I.T.A. NO.1147/MDS/2008. THEREFORE, ACCORDING TO THE LD. COUNSEL, IT IS A CO VERED MATTER. 6. ON THE OTHER HAND, SHRI HOMI RAJ VANSH, THE LD. DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT HE IS PLACING HIS REL IANCE ON THE OBSERVATION MADE BY THE ASSESSING OFFICER AND THE C IT(APPEALS). 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THIS TRIBUNAL IN THE CASE OF INDIAN OVERSEAS BANK IN I.T.A. NO.248/MDS/2 010 CONSIDERED AN IDENTICAL ISSUE AND FOUND THAT THE BROUGHT FORWARD LOSSES WOULD NOT BE DEDUCTED WHILE COMPUTING THE TOTAL INCOME FOR THE P URPOSE OF DEDUCTION 4 I.T.A. NO.2503/CHNY/17 I.T.A. NOS.2476 & 2477/CHNY/ 17 UNDER SECTION 36(1)(VIIA) OF THE ACT. IN VIEW OF T HIS, THE BROUGHT FORWARD LOSSES WOULD NOT BE REQUIRED TO BE SET OFF. 8. HOWEVER, THE CIT(APPEALS) IS REFERRING TO A JUDG MENT OF APEX COURT. THERE IS NO REFERENCE ABOUT THE CASE NAME O R THE REPORT WHEREIN THE SAID CASE WAS REPORTED. THEREFORE, IT IS NOT K NOWN WHICH CASE OF THE APEX COURT THE CIT(APPEALS) WAS REFERRING TO. IF T HERE IS A JUDGMENT OF APEX COURT AS REFERRED BY THE CIT(APPEALS), THIS TR IBUNAL IS OF THE CONSIDERED OPINION THAT THE JUDGMENT OF APEX COURT HAS TO BE FOLLOWED. HOWEVER, IT IS OBLIGATORY ON THE PART OF BOTH THE C IT(APPEALS) AND LD. D.R. TO MENTION THE REFERENCE OF THE CASE WHEREIN T HE APEX COURT DECIDED THE ISSUE AND HOW THE JUDGMENT OF THE APEX COURT IS APPLICABLE TO THE FACTS OF THE PRESENT CASE. SINCE SUCH AN EN DEAVOUR WAS NOT MADE BY BOTH THE CIT(APPEALS) AND THE LD. D.R., THIS TRI BUNAL IS OF THE CONSIDERED OPINION THAT THE MATTER NEEDS TO BE RECO NSIDERED BY THE ASSESSING OFFICER. ACCORDINGLY, ORDERS OF BOTH THE AUTHORITIES BELOW ARE SET ASIDE AND THE MATTER IS REMITTED BACK TO THE FI LE OF THE ASSESSING OFFICER. THE ASSESSING OFFICER SHALL RECONSIDER TH E ISSUE IN THE LIGHT OF THE ORDER OF THIS TRIBUNAL IN INDIAN OVERSEAS BANK (SUPRA) AND ALSO THE JUDGMENT OF APEX COURT WHICH WAS REFERRED BY THE CI T(APPEALS) IN THE IMPUGNED ORDER AND THEREAFTER DECIDE THE ISSUE AFRE SH IN ACCORDANCE WITH LAW, AFTER GIVING A REASONABLE OPPORTUNITY TO THE ASSESSEE. 5 I.T.A. NO.2503/CHNY/17 I.T.A. NOS.2476 & 2477/CHNY/ 17 9. NOW, COMING TO THE REVENUES APPEALS FOR BOTH TH E ASSESSMENT YEARS, THE ONLY ISSUE ARISES FOR CONSIDERATION IS W ITH REGARD TO DEDUCTION UNDER SECTION 36(1)(VIIA) OF THE ACT AS PER THE RUL E 6ABA OF THE INCOME- TAX RULES, 1962. 10. WE HEARD THE LD. D.R. AND THE LD.COUNSEL FOR TH E ASSESSEE. DURING THE COURSE OF HEARING, IT WAS BROUGHT TO THE NOTICE OF THE BENCH THAT IN THE ASSESSEE'S OWN CASE FOR ASSESSMENT YEAR 2007-08 IN I.T.A. NO.226/MDS/2016, THIS TRIBUNAL FOUND THAT IN VIEW O F THE DECISION OF CO- ORDINATE BENCH OF THIS TRIBUNAL IN DCIT V. MADURAI DISTRICT CENTRAL CO- OPERATIVE BANK LTD. (2014) 51 TAXMANN.COM 194, THER E WAS NO PROVISION TO CONSIDER ONLY THE ADVANCES MADE DURING THE YEAR UNDER CONSIDERATION. IN VIEW OF THE DECISION OF CO-ORDINATE BENCH OF THI S TRIBUNAL IN THE ASSESSEE'S OWN CASE FOR ASSESSMENT YEAR 2007-08, WH ICH WAS FOLLOWED BY THE CIT(APPEALS), THIS TRIBUNAL DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE LOWER AUTHORITY AND ACCORDINGLY TH E SAME IS CONFIRMED. 11. IN THE RESULT, THE ASSESSEES APPEAL IN I.T.A. NO.2503/CHNY/2017 IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. HOWEVE R, BOTH THE APPEALS OF THE REVENUE ARE DISMISSED. 6 I.T.A. NO.2503/CHNY/17 I.T.A. NOS.2476 & 2477/CHNY/ 17 ORDER PRONOUNCED IN THE COURT ON 2 ND JANUARY, 2019 AT CHENNAI. SD/- SD/- (. !') ( . . . ) (S. JAYARAMAN) (N.R.S. GANESAN ) $ / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 6 /DATED, THE 2 ND JANUARY, 2019. KRI. 0 ,/78 98(/ /COPY TO: 1. './ /ASSESSEE 2. ASSESSING OFFICER 3. 2 :/ () /CIT(A)-13, CHENNAI 4. PRINCIPAL CIT- 8, CHENNAI-34 5. 8; ,/ /DR 6. <' = /GF.