Dy. Commissioner of Income Tax , Circle-1(1), Hyderabad V. Andhra Pradesh State Financial Corporation, Hyderabad

ITA 411/Hyd/2020

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 6554 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 1 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-09-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB-B
• Next Hearing Date: 01-09-2021
• Assessment Year: 2011-2012
• Appeal Filed On: 23-07-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 143(2); 43; 13; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B : HYDERABAD (THROUGH VIRTUAL CONFERENCE) BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER IT A NO. 411 /H/20 2 0 ASSESSMENT YEAR: 2 0 1 1 - 1 2 DY. COMMISSIONER OF INCOME TAX, CIRCLE - 1(1), HYDERABAD. VS ANDHRA PRADESH STATE FINANCIAL CORPORATION, HYDERABAD. PAN AABCA 9106B (APPELLANT) (RESPONDENT) REVENUE BY: SHRI ROHIT MUJUMDAR ASSESSEE BY: NONE DATE OF HEARING: 01 /0 9 /2021 DATE OF PRONOUNCEMENT: 07 /0 9 /2021 O R D E R PER L.P. SAHU, A.M. : THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINST CIT(A) - 1 , HYDERABAD S ORDER DATED 24 /0 1 /202 0 FOR AY 20 1 1 - 1 2 INVOLVING PROCEEDINGS U/S 143 ( 3 ) R.W.S. 147 OF THE INCOME - TAX ACT, 1961; IN SHORT THE ACT ON THE FOLLOWING GROUNDS OF APPEAL: 1. THE ORDER OF THE LD. CIT(A) IS ERRONEOUS ON FACTS AS W ELL AS IN LAW. I TA NO. 411 / /HYD /20 2 0 ANDHRA PRADESH STATE FINANCIAL CORPORATION , HYDERABAD. : - 2 - : 2. THE LD. CIT(A) ERRED IN ALLOWING OTHER INCOME W ITHOUT GIVING ANY FINDING THAT THE RECEIPTS ARE FROM ELIGIBLE BUSINESS FOR COMPUTING DEDUCTION U/S 3 6(1)(VIII). 3. THE LD. CIT(A) ERRED IN ACCEPTING THE WORKING OF THE ASSESSEE WITHOUT GIVING ANY FINDING THAT RECEIPTS INCLUDED IN OTHER INCOME WERE FROM ELIGIBLE BUSINESS FOR THE P UR P OSE OF DEDUCTION U/S 36 ( 1 ) VIII ) . 4. ANY OTHER GROUND THAT MAY BE URGED AT THE TIME OF HEARING OF APPEAL. 2. WE NOTICE AT THE OUTSET THAT ASSESSEE S INSTANT APPEAL SUFFER S FROM 104 DAYS DELAY IN FILING BEFORE THE ITAT. TO THIS EFFECT, THE REVENUE FILED AN AFFIDAVIT WHEREIN IT WAS AFFIRMED THAT DUE TO GLOBAL CORONA PANDEMIC, PHYSIC AL COPY OF THE APPEAL PAPERS WERE NOT ALLOWED TO BE RECEIVED BY THE ITAT, HENCE, FORWARDED THROUGH SPEED POST, WHICH CAUSED THE IMPUGNED DELAY IN FILING OF THE INSTANT APPEAL S . CASE LAW COLLECTOR LAND ACQUISITION VS MST. KATIJI & ORS, 1987 AIR 1353 (SC) AND UNIVERSITY OF DELHI VS. UNION OF INDIA, CIVIL APPEAL NO. 9488 & 9489/2019 DATED 17 DECEMBER, 2019, HOLD THAT SUCH A DELAY; SUPPORTED BY COGENT REASONS, DESERVES TO BE CONDONED SO AS TO MAKE WAY FOR THE CAUSE OF SUBSTANTIAL JUSTICE. WE ACCORDINGLY HOL D THAT REVENUES IMPUGNED DELAY IS NEITHER INTENTIONAL NOR DELIBERATE BUT DUE TO THE CIRCUMSTANCES BEYOND ITS CONTROL. THE SAME STANDS CONDONED. CASE IS NOW TAKEN UP FOR ADJUDICATION ON MERITS. I TA NO. 411 / /HYD /20 2 0 ANDHRA PRADESH STATE FINANCIAL CORPORATION , HYDERABAD. : - 3 - : 3. BRIEFLY , T HE FACTS OF THE CAS E ARE THAT THE ASSESSEE , A STATUTORY BODY INCORPORATED UNDER THE PROVISIONS OF S TATE FINANCIAL CORPORATION ACT, 1951, FILED ITS RETURN OF INCOME FOR THE A. Y. 2011 - 12 ON 23/09/2011 ADMITTING TAXABLE INCOME OF RS.82,28,30,859/ - . THE ASSESSMENT WAS COMPLETE U/S 1 43 (3) VIDE ORDER DATED 8/1/2014. SUBSEQUENTLY, THE CASE WAS RE OPENED U/S 1 47 OF THE INCOME TAX AND THE NOTICE U/S 148 DATED 9/11/2017 WAS ISSUED AND SERVED ON THE ASSESSEE. SUBSEQUEN TLY , NOTICE U/S 143(2) WAS ISSUED AND SERVED ON THE ASSESSEE. IN R ESPONSE TO THE NOTICES ISSUED, THE LD. AR OF THE ASSESSEE AND AGM APPEARED. 3.1 THE AO OBSERVED THAT T HE ASSESSEE CLAIMED DEDUCTION OF RS.12,79,61,188/ - U/S 36(1)(VIII) OF THE INCOME TAX ACT. DURING THE COURSE OF HEARING, THE ASSESSEE WAS ASKED TO SUBSTA NTIATE ITS CLAIM OF DEDUCTION U/S 36(1)(VIII). THE ASSESSEE VIDE LETTER DATED 5/12/2018 SUBMITTED A DETAILED WORKING OF DEDUCTION A N D CLAIMED THAT INCOME NOT DIRECTLY ATTRIBUTABLE TO BUSINESS HAS BEEN EXCLUDED WHILE WORKING OUT THE DEDUCTION. THE AO OBSERVED THAT T HE DETERMINATION OF THE PROFITS AND GAINS FROM THE ELIGIBLE BUSINESS BY THE ASSESSEE D ID NOT APPEAR TO BE AS PER LA W SINCE IT HA D EXCLUDED ONLY A FEW ITEMS OF THE OTHER INCOME, BEING INCOME FROM INELIGIBLE BUSINESS. AS PER SCHEDULE K TO THE P&L ACCOU N T, THE AMOUNT OF OTHER INCOME IS SHOWN AT RS.3453.53 LAKHS. BUT HOWEVER, THE A MOUNTS DEDUCTED FOR THE PURPOSE OF COMPUTATION OF DEDUCTION U /S 36 ( 1 )( (VIII) IS I TA NO. 411 / /HYD /20 2 0 ANDHRA PRADESH STATE FINANCIAL CORPORATION , HYDERABAD. : - 4 - : RS. 484.05 LAKHS. ACCORDING TO THE AO, SINCE THE OTHER INCOME IS NOT DERIVED FROM THE BUSINESS, THE SAME IS REQUIRED TO BE EXCLUDED. ACCORDINGLY, THE AO RECOMPUTED THE ALLOWABLE DEDUCTION AT RS. 9.39 CRORES AS AGAINST THE ASSESSEES CLAIM OF DEDUCTION OF RS. 12,79,61,188 AND THE EXCESS CLAIM OF RS. 3,40,61,188/ - WAS DISALLOWED AS PER T HE TABLE AT PAGE 2 OF HIS ORDER. 4. WHEN THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A), THE CIT(A) FOLLOWING THE ORDER OF HIS PREDECESSOR IN ASSESSES OWN CASE FOR AY 2012 - 13, DIRECTED THE AO TO DELETE THE ADDITION. 5. AGGRIEVED BY THE ORDER OF TH E CIT(A), THE REVENUE IS IN APPEAL BEFORE THE ITAT. 6. NONE APPEARED ON BEHALF OF THE ASSESSEE AT THE TIME OF HEARING OF THIS APPEAL. THEREFOR E , WE PROCEED TO DECIDE THIS APPEAL AFTER HEARING THE LD. DR AND THE MATERIAL AVAILABLE ON RECORD. 7. BEFORE US , THE LD. DR SUBMITTED THAT SIMILAR ISSUE CAME UP BEFORE THE ITAT IN REVENUES APPEAL IN ASSESSEES OWN CASE FOR AY 2012 - 13, IN ITA NO. 2069/HYD/2017, VIDE ORDER DATED 08/02/2021 WHEREIN THE ISSUE WAS DECIDED IN FAVOUR OF THE ASSESSEE. A COPY OF THE SAID ORDER IS FILED ON RECORD. I TA NO. 411 / /HYD /20 2 0 ANDHRA PRADESH STATE FINANCIAL CORPORATION , HYDERABAD. : - 5 - : 8. AFTER CONSIDERING THE SUBMISSIONS OF LD. DR AND PERUSING THE MATERIAL ON RECORD AS WELL AS THE ORDERS OF REVENUE AUTHORITIES, WE FIND THAT THE COORDINATE BENCH OF THIS TRIBUNAL IN ASSESSEES OWN CASE FOR AY 2012 - 13 HAS OBSERVED AS UNDER: 4. IT IS VEHEMEN TLY CONTENDED AT THE REVENUE'S BEHEST THAT THE ASSESSING OFFICER HAD RIGHTLY FOUND DISCREPANCIES IN ASSESSEE'S DETAILS IN THE ABOVE EXTRACTED CHART (SUPRA) THAT ITS OTHER INCOME HAD BEEN WRONGLY TAKEN AS ELIGIBLE FOR DEDUCTION. MR.PANDEY THEREFORE ARGUED I N FAVOUR OF THE ASSESSMENT FINDINGS THAT THE SAME HAD RIGHTLY BEEN ADDED IN THE ASSESSEE'S HANDS BEING IN VIOLATION OF SECTION 36(1)(VIII) OF THE ACT. WE FIND NO SUBSTANCE IN REVENUE'S FOREGOING ARGUMENTS SINCE IT HAS BEEN MADE CLEAR IN THE CIT(A)'S ORDER THAT THE ASSESSEE HAD NOT ONLY FILED DETAILS IN SUPPORT OF ITS INCOME FROM THE ELIGIBLE BUSINESS BUT ALSO THAT FORMING THE INCOME INCLUDING INTEREST FROM BANK DEPOSITS AND STAFF ADVANCES ETC. THESE CLINCHING FACTUAL FINDINGS HAVE GONE UN - REBUTTED FROM THE REVENUE'S SIDE DURING THE COURSE OF HEARING. WE RESPECTFULLY FOLLOW THE SAME TO AFFIRM THE CIT(A)'S ORDER DELETING THE IMPUGNED DISALLOWAN CE. WE ALSO DEEM IT PROPER TO QUOTE HON'BLE APEX COURT'S DECISION IN CIT VS. K.Y.PILLIAH (1967) [63 ITR 411] (SC) THAT THE TRIBUNAL NEED NOT DIG DEEPER AND GIVE ITS OWN FINDINGS ONCE IT HAS EXPRESSED COMPLETE AGREEMENT WITH THE LOWER APPELLATE CONCLUSION. 8.1 AS THE ISSUE IN DISPUTE IS MATERIAL LY IDENTICAL TO THAT OF THE CASE DECIDED BY THE COORDINATE BENCH IN ASESSEES OWN CASE FOR AY 2012 - 13, RESPECTFULLY FOLLOWING THE DECISION OF THE COORDINATE BENCH IN THE SAID AY, WE UPHOLD THE ORDER OF THE CIT(A) AND DISMISS THE GROUNDS RAISED BY THE REVENUE ON THIS COUNT. I TA NO. 411 / /HYD /20 2 0 ANDHRA PRADESH STATE FINANCIAL CORPORATION , HYDERABAD. : - 6 - : 9. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED. PRONOUNCED IN THE OPEN COURT ON 7 TH SEPTEMBER, 2021 . SD/ - SD/ - ( S.S. GODARA ) (L . P . SAHU) JUDICIAL MEMBER ACCOUNTANT MEMBER HYDE RABAD, DATED : 7 TH SEPTEMBER , 20 2 1 . K V C OPY TO : 1 DCIT, CIRCLE 1(1), ROOM NO. 725, 7 TH FLOOR, B - BLOCK, IT TOWERS, AC GUARDS, MASAB TANK, HYDERABAD. 2 ANDHRA PRADESH STATE FINANCIAL CORP O RATION , 5 - 9 - 194, APSFC, CHIRAG ALI LANE, ABIDS, HYDERABAD . 3 C I T(A) 1 , HYDERABAD. 4 PR. CIT 1. HYDERABAD. 5 ITAT, DR, HYDERABAD. 6 GUARD FILE.