Shri Daneshwari Souhard Credit Co-operative Society Ltd , Mudhol V. Income Tax Officer Ward-1 , Bagalkot

ITA 30/BANG/2018

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 4656 (ITAT-BANGALORE)
• Duration Of Justice: 5 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-06-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 04-01-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DK JHA
• Assessee Lawyers: S BALACHANDRAN
• Keywords: Opportunity of being heard; Reasonable cause; Condonation of delay

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC-B BENCH : BANGALORE BEFORE SHRI ARUN KUMAR GARODIA, ACCOUNTANT MEMBER A ND SHRI LALIET KUMAR, JUDICIAL MEMBER ITA NO. 30 / BANG/201 8 ASSESSMENT YEAR : 201 0 - 1 1 M/S. SHRI DANESHWARI SOUHARD CREDIT CO-OPERATIVE SOCIETY LTD., LOKAPUR, TQ. MUDHOL. PAN: AAEAS3559B VS. THE INCOME TAX OFFICER, WARD -1, BAGALKOT. APPELLANT RESPONDENT APPELLANT BY : SHRI S. BALACHANDRAN, ADVOCATE RESPONDENT BY : SHRI D.K. JHA, ADDL. CIT (DR) DATE OF HEARING : 2 2 . 0 5 .2018 DATE OF PRONOUNCEMENT : 08 . 0 6 .2018 O R D E R PER SHRI A.K. GARODIA, ACCOUNTANT MEMBER THIS APPEAL IS FILED BY THE ASSESSEE WHICH IS DIREC TED AGAINST THE ORDER OF LD. CIT (A), GULBARGA DATED 11.09.2017 FOR ASSESSMENT Y EAR 2010-11. 2. THE GROUNDS RAISED BY THE ASSESSEE ARE AS UNDER. 1. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(APPEALS) ERRED IN DISMISSING THE APPEAL WITHOUT APPRECIATING THE FACT THAT THE HON'BLE SUPREME IN THE CASE OF CITIZE N CO-OP SOCIETY LTD V. ACIT (2017) 397 ITR 1 (SC) WHEREIN, THE HON'BLE SUPREME COURT HAS HELD THAT THE SOCIETY CANNOT BE TERMED AS PRIMA RY CO-OPERATIVE BANK WITHIN THE MEANING OF SECTION 80P(4) OF THE I. T. ACT, 1961, SINCE IT IS NOT GOVERNED BY THE PROVISIONS OF BANKING REG ULATION ACT, 1949 NOR IT HAS LICENCE FROM THE RBI. 2. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(APPEALS) ERRED IN DENYING THE DEDUCTION CLAIMED BY THE APPELLANT OF RS.6,52,060/- UNDER SECTION 80P(2)(A)(I) OF THE IT ACT, 1961, MERELY BECAUSE ASSESSEE COULD NOT APPEAR FOR HEARING AS FO R THE MISTAKE COMMITTED BY THE COUNSEL, ASSESSEE CANNOT BE PENALI ZED IN LAW. 3. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT (APPEALS) ERRED IN SUSTAINING THE DISALLOWANCE OF D EDUCTION CLAIMED BY THE ASSESSEE UNDER SECTION 80P (2) (A) (I) AND T REATING THE APPELLANT CO-OPERATIVE CREDIT SOCIETY AS PRIMARY CO-OPERATIVE BANK WITHOUT ITA NO.30/BANG/2018 PAGE 2 OF 4 APPRECIATING THE FACT THAT THE HON'BLE SUPREME COUR T ITSELF HAS HELD THAT SOCIETY IS NOT A PRIMARY CO-OPERATIVE BANK AS ENVISAGED IN SECTION 80P (4) OF THE I.T. ACT, 1961. 4. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT (APPEALS) ERRED IN NOT CONSIDERING THE FACT THAT TH ERE ARE NO GENERAL PUBLIC ADMITTED TO THE MEMBERSHIP OF THE SOCIETY IN VIOLATION OF PROVISIONS OF CO-OPERATIVE SOCIETIES ACT, 1959. 5. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT (APPEALS) FURTHER ERRED IN UPHOLDING THE ACTION OF THE ASSESSING OFFICER THAT THE ASSESSEE IS A PRIMARY CO-OPERATIVE BANK AS REFERRED IN SECTION 5(CCI) OF THE BANKING REGULATION ACT, 1949 IGNORING THE DECISION OF HON'BLE SUPREME COURT IN THE CASE OF CI TIZEN CO-OP SOCIETY CITED SUPRA. 6. THE LEARNED CIT (APPEALS) OUGHT TO HAVE APPRECIA TED THAT INSERTION OF CLAUSE (VIIA) IN SECTION IN SECTION 2(24) OF THE IT ACT 1961 DOES NOT ALTER THE POSITION AS FAR CLAIM OF DEDUCTION UNDER SECTION 80P (2) (A) (I) APPLICABLE TO CO-OPERATIVE CREDIT SOCIETY ENGAG ED IN PROVIDING CREDIT FACILITIES TO ITS MEMBERS. 7. THE ASSESSEE PRAYS TO ADD, ALTER OR AMEND ANY OF THE FOREGOING GROUNDS OF APPEAL AT THE TIME OF HEARING. 3. AT THE VERY OUTSET, IT WAS SUBMITTED BY LD. AR O F ASSESSEE THAT THERE IS DELAY OF 42 DAYS IN FILING THE APPEAL BEFORE THE TRIBUNAL AN D THE ASSESSEE HAS FILED APPLICATION FOR CONDONATION OF DELAY ALONG WITH AN AFFIDAVIT WHEREIN IT IS EXPLAINED BY THE ASSESSEE THAT THE IMPUGNED ORDER O F CIT(A) WAS RECEIVED BY THE ASSESSEE ON 21.09.2017 AND THE SAME WAS HANDED OVER TO SHRI SUNIL D KALBURGI, ITP, BELAGAVI FOR ADVICE AND FURTHER ACTI ON IN THIS MATTER AND ASSESSEE WAS UNDER THE IMPRESSION THAT THE SAID ITP WILL DO THE NEEDFUL AND LATER ON THE ASSESSEE REALIZED THAT HE HAS NOT FILE D THE APPEAL FOR THE REASONS BEST KNOWN TO HIM. IT IS ALSO SUBMITTED THAT THE A SSESSEE HAS PAID THE APPEAL FEES FOR FILING APPEAL BEFORE THE TRIBUNAL IN TIME AND HANDED OVER THE SAID FEES RECEIPT ALSO ALONG WITH OTHER DOCUMENTS TO SHRI SUN IL D KALBURGI WHICH IS WITHIN THE PERMITTED TIME FOR FILING THE APPEAL BEFORE THE TRIBUNAL AND THEREFORE, THE DELAY IN FILING THE APPEAL BEFORE THE TRIBUNAL IS B ECAUSE OF A REASONABLE CAUSE AND THEREFORE, THE DELAY SHOULD BE CONDONED. THE L D. DR OF REVENUE SUBMITTED THAT THE DELAY SHOULD NOT BE CONDONED. ITA NO.30/BANG/2018 PAGE 3 OF 4 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND CON SIDERING THE FACTS OF PRESENT CASE AS NOTED ABOVE AND IN THE INTEREST OF JUSTICE, WE CONDONE THE DELAY AND ADMIT THE APPEAL. 5. REGARDING THE MERIT OF THE APPEAL, IT WAS SUBMIT TED BY LD. AR OF ASSESSEE THAT IT IS NOTED BY CIT (A) IN PARA 3 OF HIS ORDER THAT THE CIT (A) HAS ISSUED SEVERAL NOTICES OF HEARING DURING 02.09.2014 TO 21.08.2017. HE SUBMITTED THAT THERE WAS NO APPEARANCE BECAUSE THE NOTICES WERE NOT SERV ED ON THE ASSESSEE. HE SUBMITTED THAT IN THE INTEREST OF JUSTICE, THE MATT ER SHOULD BE RESTORED BACK TO THE FILE OF CIT(A) FOR FRESH DECISION AFTER PROVIDI NG ADEQUATE OPPORTUNITY OF BEING HEARD TO ASSESSEE. THE LD. DR OF REVENUE SUP PORTED THE ORDER OF CIT (A) STATING THAT SUFFICIENT OPPORTUNITIES WERE PROVIDED BY CIT (A) AND THEREFORE, NO FURTHER OPPORTUNITY IS REQUIRED TO BE PROVIDED TO A SSESSEE. 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FI ND THAT IN PARA 3 OF HIS ORDER, IT IS NOTED BY CIT (A) THAT DURING 02.09.2014 TO 21 .08.2017, SEVERAL NOTICES WERE ISSUED BUT THERE WAS NO RESPONSE FROM THE ASSE SSEE. THE LD. CIT(A) HAS FOLLOWED THE TRIBUNAL ORDER RENDERED IN THE CASE OF CIT VS. MULTIPLAN INDIA (P) LTD. AS REPORTED IN 38 ITD 320(DEL) AND DISMISSED T HE APPEAL OF THE ASSESSEE WITHOUT ANY DECISION ON MERIT. WE ALSO FIND THAT T HERE IS NO MENTION IN THE ORDER OF CIT (A) AS TO WHETHER THE NOTICES WERE SER VED ON THE ASSESSEE OR NOT. HENCE, WE FEEL IT PROPER THAT IN THE INTEREST OF JU STICE, THE MATTER SHOULD BE RESTORED BACK TO THE FILE OF CIT (A) FOR FRESH DECI SION AFTER PROVIDING REASONABLE OPPORTUNITY OF BEING HEARD TO BOTH SIDES. WE ORDER ACCORDINGLY. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE MENT IONED ON THE CAPTION PAGE. SD/- SD/- (LALIET KUMAR) (ARUN KUMAR GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER BANGALORE, DATED, THE 08 TH JUNE, 2018. /MS/ ITA NO.30/BANG/2018 PAGE 4 OF 4 COPY TO: 1. APPELLANT 4. CIT(A) 2. RESPONDENT 5. DR, ITAT, BANGALORE 3. CIT 6. GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY, INCOME TAX APPELLATE TRIBUNAL, BANGALORE.