ITO, Ward 1(1), Nashik V. HAL (ND) Employees Co-operative Credit Society, Nashik

ITA 306/PUN/2013

• Counselvise Citation: 30624514 RSA 2013
• Duration Of Justice: 1 year(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-02-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 31-01-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S P WALIMBE
• Assessee Lawyers: ABHAY A AVACHAT
• Section: 143(3); 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHE B, PUNE BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI R.S. PADVEKAR, JUDICIAL MEMBER ITA NO.306/PN/2013 (ASSESSMENT YEAR : 2009-10) INCOME TAX OFFICER, WARD 1(1), NASHIK . APPELLANT VS. HAL (ND) EMPLOYEES CO-OPERATIVE CREDIT SOCIETY, TYPE-III, B-121/122, OZAR TOWNSHIP, OZAR, DIST. NASHIK. PAN : AADFH5852N . RESPONDENT DEPARTMENT BY : MR. S. P. WALIMBE ASSESSEE BY : MR. ABHAY A. AVACHAT DATE OF HEARING : 20-02-2014 DATE OF PRONOUNCEMENT : 24-02-2014 ORDER PER G. S. PANNU, AM THE CAPTIONED APPEAL BY THE REVENUE IS DIRECTED AGA INST AN ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-I, NASHIK DATED 01.11.2012 WHICH, IN TURN, HAS ARISEN FROM AN ORDER DATED 29.12.2011 PASSED BY THE ASSESSING OFFICER U/S 143(3) OF THE INCOME-TAX ACT, 1961 (IN SHORT THE ACT), PERTAINING TO THE ASSESSMENT YEAR 2009-10. 2. IN THIS APPEAL, THE ONLY ISSUE IS WITH REGARD TO THE ACTION OF THE CIT(A) IN HOLDING THAT THE ASSESSEE WAS ENTITLED TO DEDUCTION U/S 80P(2)(A)(I) OF THE ACT WITH RESPECT TO THE INCOME ON ACCOUNT OF INTEREST E ARNED FROM OTHER NATIONALIZED BANKS. 3. THE ASSESSEE BEFORE US IS A CO-OPERATIVE CREDIT SOCIETY WHICH IS ENGAGED IN THE BUSINESS OF PROVIDING CREDIT FACILIT IES TO ITS MEMBERS. DURING THE YEAR UNDER CONSIDERATION, ASSESSEE HAD RECEIVED INTEREST INCOME OF RS.39,42,138/- FROM ITS INVESTMENT WITH STATE BANK OF INDIA AND BANK OF MAHARASHTRA ON WHICH ASSESSEE CLAIMED DEDUCTION U/S 80P(2)(A)(I) OF THE ACT, ITA NO.306/PN/2013 A.Y. 2009-10 WHICH WAS DENIED BY THE ASSESSING OFFICER. THE CIT (A) HAS SINCE ALLOWED THE CLAIM OF THE ASSESSEE ON VARIOUS GROUNDS INTER-ALIA NOTICING THAT IN THE ASSESSEES OWN CASE FOR ASSESSMENT YEARS 1996-97 TO 1998-99 AND 2000-01 VIDE ITA NO.150/PN/2005; ITA NOS.546 & 547/PN/2003; AND, ITA NO.151/PN/2005 RESPECTIVELY DATED 29.09.2006, SIMIL AR CLAIM HAS BEEN ALLOWED, A COPY OF THE SAID DECISION OF THE TRIBUNA L DATED 29.09.2006 (SUPRA) HAS BEEN PLACED ON RECORD. 4. AT THE TIME OF HEARING, IT WAS A COMMON POINT BE TWEEN THE PARTIES THAT THE PRECEDENT RELIED UPON BY THE CIT(A), WHICH HAS BEEN RENDERED IN THE ASSESSEES OWN CASE FOR ASSESSMENT YEARS 1996-97 TO 1998-99 AND 2000-01, HAS NOT BEEN ALTERED BY ANY HIGHER AUTHORITY. AS A RESULT, WE FIND NO REASON TO INTERFERE WITH THE ULTIMATE CONCLUSION OF THE CIT(A ) WHICH IS BASED ON THE DECISION OF THE TRIBUNAL DATED 29.09.2006 (SUPRA) I N THE ASSESSEES OWN CASE. NEVERTHELESS, IN ORDER TO IMPART COMPLETENESS TO TH E ORDER, WE REPRODUCE HEREUNDER THE RELEVANT PORTION OF THE ORDER OF THE TRIBUNAL DATED 29.09.2006 (SUPRA) :- 2. THE ASSESSEE IS A CO-OPERATIVE SOCIETY OF HAL EM PLOYEES REGISTERED UNDER THE MAHARASHTRA CO-OPERATIVE SOCIE TIES ACT, 1960 AND FORMED WITH THE SOLE PURPOSE OF PROVIDING CREDIT FA CILITIES TO ITS MORE THAN 5000 MEMBERS. THE RETURN FOR A.Y 1996-97 WAS FILED ON 31 .10.1996 SHOWING TOTAL INCOME OF RS. 18,400. IN THE ASSESSMENT ORDER PASSE D U/S 147 OF THE ACT ON 16.03.2004, THE TOTAL INCOME WAS ASSESSED AT RS, 46 ,05,731/- AS UNDER: (RS) (RS) (RS) GROSS TOTAL INCOME 1,14,40,254 LESS : DEDUCTION CLAIMED 1,13,87,900 U/S 80P(2)(A)(I) LESS : INTEREST INCOME 48,79,682 COMMISSION INCOME 1,11,331 49,91,013 63,96,887 LESS : 50,43,367 DEDUCTION FOR DIVIDEND 35,070 U/S 80P(2)(D) TOTAL INCOME 50,08,297 3. THE CIT(A) ALLOWED THE ASSESSEE'S CLAIM FOR DED UCTION U/S 80P(2) IN RESPECT OF INCOME FROM INTEREST AND FROM COMMISSION AND HIS ORDER HAS BEEN CHALLENGED BY THE DEPARTMENT IN THE PRESEN T APPEAL. 4. THE FACTS ARE IDENTICAL IN RESPECT OF BOTH THE A PPEALS FOR AY 1997-98 AND 1998-99. IT WAS POINTED OUT BY MRS. DEE PA KHARE, THE ID A.R THAT ITA NO.306/PN/2013 A.Y. 2009-10 THE ISSUE INVOLVED IN THESE APPEALS WAS COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISIONS OF ITAT PUNE, IN THE FOLLOWING CASES: I. THE MSRTC (M) EMPLOYEES CO-OPERATIVE CREDIT SOCIETY LTD., AURANGABAD AND OTHERS IN ITAT NO.795 /PN/2004 FOR AY 1997-98, ETC. DATED 21.10.2005. II. SHRI SAHASTRARJUN NAGARI SAH. PAT SANSTHA LTD., SOLAPUR IN ITAT NO.1161/PN/01 FOR A.Y 1995-96 DATED 23 02.2005 . III. SHRI MAHAVIR NAGARI SAHAKARI PAT SANSTHA LTD. VS DCIT (2002) 74 TTJ (PUNE) 793. IV. NEMINATH NAGARI SAHAKARI PAT SANSTHA MARYA DIT IN ITAT NO.421/PN/2002 FOR A.Y 1998-99 DATED 23.02.2005 5. WE HAVE CONSIDERED THE RIVAL SUBMISSION IN THE L IGHT OF MATERIAL ON RECORD. WE FIND THAT THE ISSUE INVOLVED IN THESE APPEALS IS COVERED IN FAVOUR OF THE ASSESSEE-SOCIETY BY THE DECISION OF T HE I.T.A.T. PUNE IN THE CASES MENTIONED ABOVE. 6. IN THE CASE OF SHRI MAHAVIR NAGARI SAHAKAR I PAT SANSTHA LTD. (SUPRA), IT WAS NOTED BY THE TRIBUNAL THAT THE ASSESSEE WAS A CO-OPERATIVE CREDIT SOCIETY REGISTERED UNDER THE MAHARASHTRA STA TE CO-OPERATIVE SOCIETIES ACT,1960 AND WAS ENGAGED IN CARRYING ON THE BUSINES S OF PROVIDING CREDIT FACILITIES TO ITS MEMBERS AND ALSO OF BANKING, THAT THE ASSESSEE-SOCIETY GAVE LOANS TO ITS MEMBERS, THAT THE MEMBERS INCLUDED NOM INAL MEMBERS ALSO WHO WERE ADMITTED AS PER THE BYE-LAWS OF THE SOCIETY, T HAT THE ASSESSEE-SOCIETY SATISFIED THE CONDITIONS LAID DOWN U/S 80P(2)(A)(I) OF THE ACT AND WAS ENTITLED TO DEDUCTION U/S 80P. 7. IN THE CASE OF NEMINATH NAGARI SAHAKARI PAT SANS THA MARYADIT (SUPRA), THE INCOME FROM INVESTMENTS IN GOVERNMENT SECURITIES, FIXED DEPOSITS, KVPS, IVPS ETC., WAS HELD TO BE EXEMPT U/ S 80P(2) OF THE ACT. 8. THEREFORE, WE FOLLOW PRECEDENTS AND UPHOLD THE O RDERS OF THE CIT(A). 9. IN THE RESULT, THE APPEALS FILED BY THE DEPARTME NT FOR A.Y. 1997- 98 AND 1998-999 ARE DISMISSED. 5. FOLLOWING THE AFORESAID PRECEDENT, WE AFFIRM THE ORDER OF THE CIT(A), AS IT HAS NOT BEEN SHOWN THAT THE PRECEDENT RENDERED I N ASSESSEES OWN CASE HAS BEEN ALTERED BY ANY HIGHER AUTHORITY. THUS, RE VENUE FAILS ON THIS ASPECT. 6. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 24 TH FEBRUARY, 2014. SD/- SD/- (R.S. PADVEKAR) (G.S. PANNU) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE, DATED: 24 TH FEBRUARY, 2014. SUJEET ITA NO.306/PN/2013 A.Y. 2009-10 COPY OF THE ORDER IS FORWARDED TO : - 1) THE ASSESSEE; 2) THE DEPARTMENT; 3) THE CIT(A)-I, NASHIK; 4) THE CIT-I, NASHIK; 5) THE DR, B BENCH, I.T.A.T., PUNE; 6) GUARD FILE. BY ORDER //TRUE COPY// SR. PRIVATE SECRETARY I.T.A.T., PUNE