Dhanlaxmi Credit Co.Opreative Society Ltd., Mehsana V. The Income Tax Officer,Ward-2, Patan

ITA 3268/AHD/2014

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 8641 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 9 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-09-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 30-05-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 08-12-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: D K PARIKH

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL, C BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER ./ ITA.NO.3268 AND 3269/AHD/2014 / ASSTT. YEAR: 2010-2011 AND 2011-12 DHANALAXMI CREDIT CO - OPERATIVE SOCIETY LTD. POONAM COMPLEX UNJHA. VS ITO, WARD - 2 PATAN. ! / (APPELLANT) '# ! / (RESPONDENT) ASSESSEE BY : SHRI D.K. PARIKH, CA REVENUE BY : SHRI PRASOON KABRA, SR.DR / DATE OF HEARING : 08/08/2017 / DATE OF PRONOUNCEMENT: 08 /09/2017 $%/ O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER: ASSESSEE IS IN APPEALS BEFORE THE TRIBUNAL AGAINST ORDER OF LD.CIT(A), GANDHINAGAR DATED 22.9.2014 PASSED FOR THE ASSTT.YE ARS 2010-11 & 2011-12. 2. IN BOTH THE APPEALS, THE GRIEVANCE OF THE ASSESS EE IS THAT THE LD.CIT(A) HAS ERRED IN CONFIRMING DISALLOWANCE SECTION 80P(2) (A)(I) OF THE INCOME TAX ACT, 1961 ON THE INTEREST INCOME EARNED FROM NATION ALIZED BANKS AMOUNTING TO RS.7,85,525/- AND RS.6,84,382/- IN THE ASSTT.YEA R 2010-11 AND 2011-12. ITA NO.3268 AND 3269 /AHD/2014 2 3. THE LD.COUNSEL FOR THE ASSESSEE, AT THE VERY OUT SET, SUBMITTED THAT AN IDENTICAL ISSUE WAS CONSIDERED IN THE CASE FOR THE ASSTT.YEAR 2009-10. THE TRIBUNAL HAS UPHELD THE DISALLOWANCE OF DEDUCTION U NDER SECTION 80P(2)(1) ON THE INTEREST INCOME EARNED FROM THE NATIONALIZED BA NKS, AFTER PUTTING RELIANCE UPON THE DECISION OF THE HONBLE JURISDICTIONAL HIG H COURT IN THE CASE OF STATE BANK OF INDIA VS. CIT, 389 ITR 578. HE PLACED ON R ECORD COPY OF TRIBUNALS ORDER AND SUBMITTED THAT SIMILAR DIRECTIONS BE GIVE N IN THE PRESENT YEARS. 4. THE LD.DR WAS UNABLE TO CONTROVERT THE CONTENTIO NS OF THE LD.COUNSEL FOR THE ASSESSEE. 5. WE HAVE DULY CONSIDERED RIVAL CONTENTIONS AND GO NE THROUGH THE RECORD CAREFULLY. WE FIND THAT IN AN IDENTICAL SITUATION THE TRIBUNAL HAS ISSUED FOLLOWING DIRECTIONS IN THE ASSTT.YEAR 2009-10 FOR VERIFICATION OF THE ASSESSEES CLAIM. 11) RESPECTFULLY FOLLOWING THE JUDGMENT OF HON. JURISDICTIONAL HIGH COURT AND EXAMINING THE FACTS OF THE CASE AS ALSO I N THE LIGHT OF DECISION OF THE CO-ORDINATE BENCH DISCUSSED IN THE ABOVE PARAGRAPHS, WE ARE OF FOLLOWING VIEW :- (1) ASSESSEE IS NOT ELIGIBLE FOR DEDUCTION U/S 80P( 2)(A)(I) OF THE ACT ON THE INTEREST INCOME EARNED FROM SURPLUS DEPOSITS HE LD WITH NATIONALIZED/SCHEDULED BANKS. (2) ASSESSEE WILL BE ELIGIBLE TO STATUTORY DEDUCTIO N OF RS.50,000/-U/S 80P(2)(C) (II) OF THE ACT. (3) ASSESSEE WILL ALSO BE ELIGIBLE TO CLAIM PRO RAT A EXPENSES FOR EARNING INTEREST INCOME OF RS.8,55,854/- ASSESSEE'S CLAIM O F PRO RATA EXPENSES OF RS.5,77,423/- AGAINST THE INTEREST INCOME OF RS. 8,55,854/- AFTER DUE VERIFICATION BY THE LEARNED ASSESSING OFFICER. WE, THEREFORE, DIRECT THE ASSESSING OFFICER TO VERI FY ASSESSEE'S CLAIM OF PRO RATA EXPENSES BY EXAMINING THE RECORD TO BE SHO WN FOR VERIFICATION BY THE ASSESSEE. NEEDLESS TO MENTION PROPER OPPORTU NITY OF BEING HEARD ITA NO.3268 AND 3269 /AHD/2014 3 IS TO BE GIVEN TO THE ASSESSEE. WE ORDER ACCORDINGL Y. THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES . 6. RESPECTFULLY FOLLOWING ORDER OF THE CO-ORDINATE BENCH IN THE ASSTT.YEAR 2009-10, WE DIRECT THE AO TO CARRY OUT SIMILAR EXERCISE IN THESE TWO YEARS AFTER PROVIDING PROPER OPPORTUNITY TO THE ASSESSEE. 7. IN THE RESULT, THE APPEALS OF THE ASSESSEE ARE P ARTLY ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE COURT ON 8 TH SEPTEMBER, 2017 AT AHMEDABAD. SD/- SD/- (AMARJIT SINGH) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER