M/s.Kottakkal Co-op Urban Bank ltd, Malappuram V. ACIT, Tirur

ITA 546/COCH/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 77432 (ITAT-COCHIN)
• Duration Of Justice: 7 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-04-2014
• Appeal Filed By: Assessee
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 11-09-2013
• Court: TRIBUNAL
• Department Lawyers: K K JOHN
• Assessee Lawyers: ROSIE ATHULYA JOSEPH
• Keywords: Sale consideration of property below Jantri Value

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE S/SHRI N.R.S.GANESAN, JM AND B.R.BASKAR AN, AM I.T.A. NO. 546/COCH/2013 ASSESSMENT YEAR : 2010-11 M/S. KOTTAKAL CO-OPERATIVE URBAN BANK LTD., KOTTAPPADI, KOTTAKKAL MALAPPURAM-676 503. [PAN: AAALK 0050C] VS. THE ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE-2(2), TIRUR. (ASSESSEE -APPELLANT) (REVENUE-RESPONDEN T) ASSESSEE BY MS. ROSIE ATHULYA JOSEPH, ADV. REVENUE BY SHRI K.K. JOHN, SR. DR DATE OF HEARING 07/042014 DATE OF PRONOUNCEMENT 11/04/2014 O R D E R PER B.R.BASKARAN, ACCOUNTANT MEMBER: THE APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER DATED 16.07.2013 PASSED BY THE LD. CIT(A), KOZHIKODE AND IT RELATES TO THE ASSESSMENT YEAR 2010-11. 2. THE SOLITARY ISSUE URGED IN THE APPEAL RELATES T O THE DEFINITION OF RURAL BRANCH FOR THE PURPOSE OF ARRIVING AT DEDUCTION U/ S. 36(1)(VIIA) OF THE ACT. 3. THE FACTS RELATING TO THE ABOVE SAID ISSUE ARE STATED IN BRIEF. IN TERMS OF SEC. 36(1)(VIIA)(A) OF THE ACT, THE ASSESSEE HEREIN IS ENTITLED FOR A DEDUCTION OF PROVISION MADE FOR BAD AND DOUBTFUL DEBT AT AN AMOU NT NOT EXCEEDING 7.5% OF THE TOTAL INCOME (COMPUTED BEFORE MAKING ANY DEDUCT ION UNDER 36(I)(VIIA) AND CHAPTER VIA) AND AN AMOUNT NOT EXCEEDING 10% OF THE AGGREGATE AVERAGE I.T.A. NO. 546/COCH/2013 2 ADVANCES MADE BY THE RURAL BRANCHES OF THE ASSESSEE BANK. THE TERM RURAL BRANCH IS DEFINED AS UNDER IN THE EXPLANATION TO SE C. 36(1)(VIIA) OF THE ACT:- RURAL BRANCH MEANS A BRANCH OF A SCHEDULED BANK O R A NON-SCHEDULED BANK SITUATED IN A PLACE WHICH HAS A POPULATION OF NOT MORE THAN TEN THOUSAND ACCORDING TO THE LAST PRECEDING CENSUS OF WHICH THE RELEVANT FIGURES HAVE BEEN PUBLISHED BEFORE THE FIRST DAY OF THE PREVIOUS YEAR THE ASSESSEE INTERPRETED THE TERM A PLACE AS THE WARD WITHIN THE REVENUE VILLAGE AND ACCORDINGLY CLAIMED DEDUCTION ON THE AD VANCES WHERE THE POPULATION OF THE WARD WAS LESS THAN 10,000. HOWEVER, THE ASS ESSING OFFICER REJECTED THE SAID CLAIM WITH THE FOLLOWING OBSERVATIONS:- ON A DISCUSSION WITH THE AUTHORIZED REPRESENTATIV E OF THE ASSESSEE BANK, IT IS NOTICED THAT THE DEDUCTION OF 10% OF RURAL A DVANCES IS MADE ON THE INTERPRETATION OF THE MEANING OF PLACE AS GIVEN IN SECTION 36(1)(VIIA) OF THE ACT. THE ASSESSEE AS IN LAST YEAR HAS CONSI DERED ITS BRANCHES AS RURAL SINCE THESE BRANCHES ARE SITUATED IN WARDS THAT HAVE A POPULATION OF LESS THAN 10,000 AS PER THE LAST CENS US. THE DEFINITION OF THE TERM PLACE HAS NOW BEEN CONCLUSIVELY DEFINED BY THE HONBLE HIGH COURT OF KERALA IN THE CASE OF LORD KRISHNA BANK LT D. IN ITS JUDGMENT IN ITA 234 OF 2009 THE COURT HAS HELD THAT THE POPULAT ION OF GRAMA PANCHAYAT, WHICH IS THE PRIMARY UNIT OF THE GOVERNM ENT, HAS TO BE CONSIDERED AND NOT THAT OF THE WARD. THE ISSUE THE REFORE, IS SQUARELY COVERED AGAINST THE ASSESSEE BY THE SAID DECISION O F THE JURISDICTIONAL HIGH COURT. IT IS ALSO PERTINENT TO NOTE THAT APPE ALS FILED BY THE ASSESSEE BANK FOR THE ASSESSMENT YEARS 2007-08, 2008-09 AND 2009-10 ON THE SAME ISSUE HAS BEEN DISMISSED BY THE CIT(A) RELYING ON THE SAID JUDGMENT. SINCE ALL THE BRANCHES OF THE ASSESSEE B ANK ARE LOCATED IN PLACES WHEREIN THE POPULATION EXCEEDS 10,000 THE ASSESSEE IS NOT ELIGIBLE FOR THE CLAIM MADE BY IT. 4. IN THE APPELLATE PROCEEDINGS, THE LD CIT(A) DISMISSED THE APPEALS FILED BY THE ASSESSEE BY FOLLOWING THE DECISION RENDERED BY THE TRIBUNAL IN THE ASSESSEES OWN CASE IN ITA NO.369/COCH/2011 DATED 16.11.2012. AGGRIEVED, THE ASSESSEE HAS FILED THESE APPEALS BEFORE US. I.T.A. NO. 546/COCH/2013 3 5. WE NOTICE THAT THE ISSUE CONTESTED BEFORE US IN THE PRESENT APPEAL HAS BEEN DECIDED AGAINST THE ASSESSEE BY THIS BENCH OF TRIBUNAL IN THE ASSESSEES OWN CASE IN ITA NO.369/COCH/2011 REPORTED IN 142 IT D 123. WE NOTICE THAT THE TRIBUNAL HAS FOLLOWED THE BINDING DECISION RENDERED BY THE HONBLE JURISDICTIONAL HIGH COURT OF KERALA IN THE CASE OF LORD KRISHNA BA NK LTD. IN ITS JUDGMENT IN I.T.A. 234/2009 (195 TAXMAN 57). SINCE BOTH THE AS SESSING OFFICER HAS FOLLOWED THE BINDING DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF LORD KRISHNA BANK LTD. (SUPRA) AND THE SAME WAS CONFIRME D BY LD CIT(A), WE DO NOT FIND ANY REASON TO INTERFERE WITH THE DECISION REND ERED BY LD. CIT(A). 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. PRONOUNCED ACCORDINGLY ON 11-04-2 014. SD/- SD/- (N.R.S.GANESAN) (B.R.BASKARAN) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE: KOCHI DATED: 11TH APRIL, 2014 GJ COPY TO: 1. M/S. KOTTAKAL CO-OPERATIVE URBAN BANK LTD., KOTT APPADI, KOTTAKKAL MALAPOURAM-676 503. 2. THE ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE -2(2), TIRUR. 3. THE COMMISSIONER OF INCOME-TAX(APPEALS), KOZHIKO DE. 4. THE COMMISSIONER OF INCOME-TAX, KOZHIKODE. 5. D.R., I.T.A.T., COCHIN BENCH, COCHIN. 6. GUARD FILE. BY ORDER (ASSISTANT REGISTRAR) I.T.A.T, COCHIN