DCIT CIRCLE-3(4), MUMBAI, MUMBAI V. UNION BANK OF INDIA, MUMBAI

ITA 3652/MUM/2023

• Counselvise Citation: [2024] 100 COUNSELVISE.COM (IT) 2633 (ITAT-MUMBAI)
• Duration Of Justice: 6 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-04-2024
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Next Hearing Date: 24-04-2024
• Assessment Year: 2012-2013
• Appeal Filed On: 09-10-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Depreciation; Period of limitation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “F” MUMBAI BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) AND SHRI RAHUL CHAUDHARY (JUDICIAL MEMBER) ITA No. 3652/MUM/2023 Assessment Year: 2012-13 DCIT Circle-3(4), R. No. 559, 5 th floor, Aayakar Bhavan, M.K. Road, Mumbai-400020. Vs. Union Bank of India, Central Accounts Dept. 6 th floor, Union Bank Bhavan 239, Vidhan Bhavan Marg, Nariman Point, Mumbai-400021. PAN NO. AABCA 7375 C Appellant Respondent Assessee by : Mr. S Ananthan Revenue by : Mr. Ankush Kapoor, CIT-DR Date of Hearing : 25/04/2024 Date of pronouncement : 30/04/2024 ORDER PER OM PRAKASH KANT, AM This appeal has been preferred by the Revenue against order dated 14.08.2023 passed by the Ld. Commissioner of Income-tax (Appeals) – National Faceless Appeal Centre, Delhi [in short ‘the Ld. CIT(A)’] for assessment year 2012-13, raising following grounds: 1. (i) "Whether on the facts and in circumstances of the case and in law, the Ld. CIT(A) erred in holding that depreciation on investment viz. Available for Sale(AFS), Held for Trading (HFS) & Held to maturity (HTM) is allowable deduction" (ii) "Whether on the facts and in circumstances of the case and in law, the Ld. CIT(A) erred in deleting the disallowance of depreciation on investment without verifying from the records of bank, the purpose for which they were purchased by the bank and its nat investments". (iii) "Whether on the facts and in circumstances of the case and in law, the Ld. CIT(A) erred in deleting the disallowance of depreciation on investment without verifying whether entire investment are held to meet SLR purposes or not. 2. At the outset, the Ld. counsel for the assessee raised that in this case impugned assessment order has been passed by the Assessing Officer located at Hyderabad and therefore, in view of the decision of the Hon’ble Supreme Court in the case of PCIT v. ABC Papers Ltd. 447 ITR 1 (SC), t been filed before the Hyderabad Bench of the Tribunal before the Mumbai Bench, 3. The Ld. Counsel the Co-ordinate Bench of the Tribunal in India(erstwhile corporation bank assessment year 2007 4. We have heard rival submission of the parti relevant material on record. In the case of Union Bank of India erstwhile corporation bank (supra), the Tribunal has dismissed the appeal of the Revenue with the liberty to approach the concerned bench of the ITAT having jurisdiction ove The relevant finding of the Tribunal is reproduced as under: viz. Available for Sale(AFS), Held for Trading (HFS) & Held to maturity (HTM) is allowable deduction" "Whether on the facts and in circumstances of the case and in law, the Ld. CIT(A) erred in deleting the disallowance of depreciation on investment without verifying from the records of bank, the purpose for which they were purchased by the bank and its nature whether they are in nature of stock in trade or investments". "Whether on the facts and in circumstances of the case and in law, the Ld. CIT(A) erred in deleting the disallowance of depreciation on investment without verifying whether entire estment are held to meet SLR purposes or not. At the outset, the Ld. counsel for the assessee raised that in this case impugned assessment order has been passed by the Assessing Officer located at Hyderabad and therefore, in view of n of the Hon’ble Supreme Court in the case of PCIT v. ABC Papers Ltd. 447 ITR 1 (SC), the appeal before ITAT been filed before the Hyderabad Bench of the Tribunal Bench, therefore, same should be dismissed. Counsel for the assessee also relied on the decision of ordinate Bench of the Tribunal in the case of Union Bank of erstwhile corporation bank) in ITA No. 3090/M/2020 for assessment year 2007-08. We have heard rival submission of the parties and perused the relevant material on record. In the case of Union Bank of India erstwhile corporation bank (supra), the Tribunal has dismissed the appeal of the Revenue with the liberty to approach the concerned bench of the ITAT having jurisdiction over the Assessing Officer. The relevant finding of the Tribunal is reproduced as under: Union Bank of India 2 ITA No. 3652/MUM/2023 viz. Available for Sale(AFS), Held for Trading (HFS) & Held to "Whether on the facts and in circumstances of the case and in law, the Ld. CIT(A) erred in deleting the disallowance of depreciation on investment without verifying from the records of bank, the purpose for which they were purchased by the bank and ure whether they are in nature of stock in trade or "Whether on the facts and in circumstances of the case and in law, the Ld. CIT(A) erred in deleting the disallowance of depreciation on investment without verifying whether entire At the outset, the Ld. counsel for the assessee raised an issue that in this case impugned assessment order has been passed by the Assessing Officer located at Hyderabad and therefore, in view of n of the Hon’ble Supreme Court in the case of PCIT v. before ITAT should have been filed before the Hyderabad Bench of the Tribunal and not therefore, same should be dismissed. for the assessee also relied on the decision of the case of Union Bank of in ITA No. 3090/M/2020 for es and perused the relevant material on record. In the case of Union Bank of India erstwhile corporation bank (supra), the Tribunal has dismissed the appeal of the Revenue with the liberty to approach the concerned r the Assessing Officer. The relevant finding of the Tribunal is reproduced as under: “2. At the outset before us, Ld. Counsel for the assessee filed an application under Rule 29 of the ITAT Rules raising the issue that Assessing Officer who passed the ori situated in Mangalore falling under the jurisdiction of the Karnataka High Court and therefore, in view of the decision of the Hon’ble Supreme Court in the case of ABC Papers Ltd. [2022] 447 ITR 1 (SC) the jurisdiction of the ITAT of the Assessing Officer who passed the said assessment order. He submitted that correct jurisdiction over the appeal lies before ITAT Bangalore Bench and this appeal is not maintainable before Mumbai Bench of ITAT. The Counsel for the assessee referred to the decision of the Hon’ble Bombay High Court in the case of Peter Vaz v. CIT (2016) 436 ITR 616 (Bombay raised a ground by way of application under Rule 27 of the Income Appellate Tribunal Rules, 1963 (in short ‘the Rules’) which involve challenge of the jurisdiction of the Assessing Officer in preferring this appeal, which goes to the root of the matter, therefore application under Rule 29 might be admitted. The Ld. Couns that the decision of Hon’ble Supreme Court in ABC papers (supra) has been further followed by the Hon’ble Supreme Court in the case of MSPL Ltd. [2023] 454 ITR 280. Accordingly, the Ld. Counsel submitted that the Mumbai Bench of the T impugned appeal and the president ITAT does not have power to transfer this appeal to Bangalore Bench of ITAT in view of decision of Hon’ble Bombay High Court in the case of MSPL Ltd in the writ petition (L) No. 3865 maintainable. 3. We have heard rival submission of the parties on the issue raised under Rule 29 of the ITAT Rules. In view of the decision of the Hon’ble Bombay Court in the case of Peter Vaz (supra) the raised in application under Rule 29 of the Rules is admitted. 3.1 We find that the Hon’ble Supreme Court in the case of ABC Papers Ltd. (supra) held that appeal against every decision of the ITAT shall lie only before the High Court within whose ju Assessing Officer passed the assessment order is situated, even if the case or the cases of assessee are transferred invoking power u/s 127 of the Act, the High Court within whose jurisdiction the Assessing Officer has passed the order , sha the appeal and this principle is applicable even if the transfer is u/s 127 of the Act for same assessment year(s). The same principle lies for the filing appeal before the ITAT. In the case in hand, the Assistant Commissioner of Income assessment order, hence the appeal lies before the Bangalore Bench. Further, the Hon’ble Bombay High Court in the case of MSPL Ltd. (supra) held that the President of ITAT has no power to trans appeals from Bench at one headquarter to bench at another headquarter, and this appeal can’t be transferred to Bangalore Bench . At the outset before us, Ld. Counsel for the assessee filed an application under Rule 29 of the ITAT Rules raising the issue that Assessing Officer who passed the original assessment order is situated in Mangalore falling under the jurisdiction of the Karnataka High Court and therefore, in view of the decision of the Hon’ble Supreme Court in the case of ABC Papers Ltd. [2022] 447 ITR 1 (SC) the jurisdiction of the ITAT or the High Court would depend on the seat of the Assessing Officer who passed the said assessment order. He submitted that correct jurisdiction over the appeal lies before ITAT Bangalore Bench and this appeal is not maintainable before Mumbai AT. The Counsel for the assessee referred to the decision Hon’ble Bombay High Court in the case of Peter Vaz v. CIT (2016) 436 ITR 616 (Bombay) and submitted that assessee has raised a ground by way of application under Rule 27 of the Income ppellate Tribunal Rules, 1963 (in short ‘the Rules’) which involve challenge of the jurisdiction of the Assessing Officer in preferring this appeal, which goes to the root of the matter, therefore application under Rule 29 might be admitted. The Ld. Counsel further submitted that the decision of Hon’ble Supreme Court in ABC papers (supra) has been further followed by the Hon’ble Supreme Court in the case of MSPL Ltd. [2023] 454 ITR 280. Accordingly, the Ld. Counsel submitted that the Mumbai Bench of the Tribunal has no jurisdiction to hear the impugned appeal and the president ITAT does not have power to transfer this appeal to Bangalore Bench of ITAT in view of decision of Hon’ble Bombay High Court in the case of MSPL Ltd in the writ petition (L) No. 3865 of 2020, thus appeal need to be dismissed as non We have heard rival submission of the parties on the issue raised under Rule 29 of the ITAT Rules. In view of the decision of the Hon’ble Bombay Court in the case of Peter Vaz (supra) the raised in application under Rule 29 of the Rules is admitted. We find that the Hon’ble Supreme Court in the case of ABC Papers Ltd. (supra) held that appeal against every decision of the ITAT shall lie only before the High Court within whose jurisdiction the Assessing Officer passed the assessment order is situated, even if the case or the cases of assessee are transferred invoking power u/s 127 of the Act, the High Court within whose jurisdiction the Assessing Officer has passed the order , shall continue to exercise jurisdiction of the appeal and this principle is applicable even if the transfer is u/s 127 of the Act for same assessment year(s). The same principle lies for the filing appeal before the ITAT. In the case in hand, the Assistant mmissioner of Income-tax, Circle 2, Mangalore, has passed the assessment order, hence the appeal lies before the Bangalore Bench. Further, the Hon’ble Bombay High Court in the case of MSPL Ltd. (supra) held that the President of ITAT has no power to trans appeals from Bench at one headquarter to bench at another headquarter, and this appeal can’t be transferred to Bangalore Bench Union Bank of India 3 ITA No. 3652/MUM/2023 At the outset before us, Ld. Counsel for the assessee filed an application under Rule 29 of the ITAT Rules raising the issue that ginal assessment order is situated in Mangalore falling under the jurisdiction of the Karnataka High Court and therefore, in view of the decision of the Hon’ble Supreme Court in the case of ABC Papers Ltd. [2022] 447 ITR 1 (SC) or the High Court would depend on the seat of the Assessing Officer who passed the said assessment order. He submitted that correct jurisdiction over the appeal lies before ITAT Bangalore Bench and this appeal is not maintainable before Mumbai AT. The Counsel for the assessee referred to the decision Hon’ble Bombay High Court in the case of Peter Vaz v. CIT ) and submitted that assessee has raised a ground by way of application under Rule 27 of the Income-tax ppellate Tribunal Rules, 1963 (in short ‘the Rules’) which involve challenge of the jurisdiction of the Assessing Officer in preferring this appeal, which goes to the root of the matter, therefore application el further submitted that the decision of Hon’ble Supreme Court in ABC papers (supra) has been further followed by the Hon’ble Supreme Court in the case of MSPL Ltd. [2023] 454 ITR 280. Accordingly, the Ld. Counsel submitted ribunal has no jurisdiction to hear the impugned appeal and the president ITAT does not have power to transfer this appeal to Bangalore Bench of ITAT in view of decision of Hon’ble Bombay High Court in the case of MSPL Ltd in the writ of 2020, thus appeal need to be dismissed as non We have heard rival submission of the parties on the issue raised under Rule 29 of the ITAT Rules. In view of the decision of the Hon’ble Bombay Court in the case of Peter Vaz (supra) the ground raised in application under Rule 29 of the Rules is admitted. We find that the Hon’ble Supreme Court in the case of ABC Papers Ltd. (supra) held that appeal against every decision of the ITAT risdiction the Assessing Officer passed the assessment order is situated, even if the case or the cases of assessee are transferred invoking power u/s 127 of the Act, the High Court within whose jurisdiction the Assessing ll continue to exercise jurisdiction of the appeal and this principle is applicable even if the transfer is u/s 127 of the Act for same assessment year(s). The same principle lies for the filing appeal before the ITAT. In the case in hand, the Assistant tax, Circle 2, Mangalore, has passed the assessment order, hence the appeal lies before the Bangalore Bench. Further, the Hon’ble Bombay High Court in the case of MSPL Ltd. (supra) held that the President of ITAT has no power to transfer the appeals from Bench at one headquarter to bench at another headquarter, and this appeal can’t be transferred to Bangalore Bench 3.2 In view of the above, we are of the opinion that the appeal of the Revenue is not maintainable in present form be Mumbai Bench. The Revenue is at liberty to approach the concerned Bench of the ITAT having jurisdiction over the Assessing Officer at Mangalore, if so advised. The period of limitation in filing the appeal shall accordingly be considered by view the fact that ITAT Rules have been interpreted by the Hon’ble Bombay High Court recently, which has been further upheld by the Hon’ble Supreme Court in MSPL Ltd. (supra).” 4.1 We may also note that the Hon’ble Supreme Co of PCIT v. ABC Papers Ltd. (supra) has held the territorial jurisdiction of the Tr Assessing Officer which in this appeal is Hyderabad and therefore, the present appeal filed by the Dy. Commissioner o Mumbai is not maintainable in present form. The Revenue is it liberty to file the appeal before the concerned bench of the ITAT having jurisdiction over the Assessing Officer at Hyderabad if so advised. The period of limitation in filing th accordingly be considered by the Co above observation the appeal of the Revenue is dismissed as not maintainable. 5. In the result, the appeal of the Revenue is dismissed. Order pronounced in the open Court on Sd/ (RAHUL CHAUDHARY JUDICIAL MEMBER Mumbai; Dated: 30/04/2024 Rahul Sharma, Sr. P.S. In view of the above, we are of the opinion that the appeal of the Revenue is not maintainable in present form before the ITAT, Mumbai Bench. The Revenue is at liberty to approach the concerned Bench of the ITAT having jurisdiction over the Assessing Officer at Mangalore, if so advised. The period of limitation in filing the appeal shall accordingly be considered by the concerned Bench keeping in view the fact that ITAT Rules have been interpreted by the Hon’ble Bombay High Court recently, which has been further upheld by the eme Court in MSPL Ltd. (supra).” We may also note that the Hon’ble Supreme Co of PCIT v. ABC Papers Ltd. (supra) has held the territorial jurisdiction of the Tribunal is determined by the situs Assessing Officer which in this appeal is Hyderabad and therefore, the present appeal filed by the Dy. Commissioner o Mumbai is not maintainable in present form. The Revenue is it liberty to file the appeal before the concerned bench of the ITAT having jurisdiction over the Assessing Officer at Hyderabad if so advised. The period of limitation in filing the appeal shall accordingly be considered by the Co-ordinate Be above observation the appeal of the Revenue is dismissed as not In the result, the appeal of the Revenue is dismissed. Order pronounced in the open Court on 30/04/2024. Sd/- Sd/ (RAHUL CHAUDHARY) (OM PRAKASH KANT JUDICIAL MEMBER ACCOUNTANT MEMBER Union Bank of India 4 ITA No. 3652/MUM/2023 In view of the above, we are of the opinion that the appeal of fore the ITAT, Mumbai Bench. The Revenue is at liberty to approach the concerned Bench of the ITAT having jurisdiction over the Assessing Officer at Mangalore, if so advised. The period of limitation in filing the appeal the concerned Bench keeping in view the fact that ITAT Rules have been interpreted by the Hon’ble Bombay High Court recently, which has been further upheld by the We may also note that the Hon’ble Supreme Court in the case of PCIT v. ABC Papers Ltd. (supra) has held the territorial ibunal is determined by the situs of the Assessing Officer which in this appeal is Hyderabad and therefore, the present appeal filed by the Dy. Commissioner of Income-tax at Mumbai is not maintainable in present form. The Revenue is it liberty to file the appeal before the concerned bench of the ITAT having jurisdiction over the Assessing Officer at Hyderabad if so e appeal shall ordinate Bench. With the above observation the appeal of the Revenue is dismissed as not In the result, the appeal of the Revenue is dismissed. /04/2024. Sd/- OM PRAKASH KANT) ACCOUNTANT MEMBER Copy of the Order forwarded to 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. //True Copy// Copy of the Order forwarded to : BY ORDER, (Assistant Registrar) ITAT, Mumbai Union Bank of India 5 ITA No. 3652/MUM/2023 BY ORDER, (Assistant Registrar) ITAT, Mumbai