The Punjab State Co-operative Bank Employees Welfare Fund, Chandigarh V. ITO, Chandigarh

ITA 63/CHANDI/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 5353 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 06-01-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: MANISH GUPTA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES, SMC, CHANDIGARH BEFORE MS. DIVA SINGH, JUDICIAL MEMBER ITA NO. 63/CHD/2017 ASSESSMENT YEA R : 2011-12 THE PUNJAB STATE CO-OPERATIVE VS. THE ITO, BANK EMPLOYEES WELFARE FUND, WARD 4(2), CHANDIGARH. CHANDIGARH. PAN NO. AAAAT5117E (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI MANISH GUPTA RESPONDENT BY : SMT.CHANDER KANTA, SR.DR DATE OF HEARING : 14.11.2017 DATE OF PRONOUNCEMENT : 08.01. 2018 ORDER THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE ASSA ILING THE CORRECTNESS OF THE ORDER DATED 25.10.2016 OF LD. CIT (APP EALS)-2 GURGAON PERTAINING TO 2011-12 ASSESSMENT YEAR ON THE FOLLOWING GROUNDS : 1. THAT THE LD. CIT(A) ERRED IN LAW AND ON FACTS IN NO T CONSIDERING THE SUBMISSIONS PLACED BEFORE HIM DURING THE COURSE OF APPELLATE PR OCEEDINGS. HE HAS ALSO ERRED IN NOT CONSIDERING THE DECISIONS CITED BEFORE HIM OF VARIO US COURTS/TRIBUNALS INCLUDING DECISIONS OF JURISDICTIONAL HIGH COURT. 2. THAT THE ORDER PASSED BY THE LD. COMMISSIONER OF IN COME TAX (APPEALS)-I, GURGAON IS CONTRARY TO THE FACTS AND CIRCUMSTANCES OF THE C ASE. 3. THAT THE LD. CIT(A), THEREFORE ERRED IN LAW AND ON FACTS IN CONFIRMING THE ADDITIONS FOR RS. 3,30,497/- MADE BY THE INCOME TAX OFFICER, WARD-4(2), CHANDIGARH (AO) ON ACCOUNT OF NOT CONSIDERING THE CLAIM OF THE ASSE SSEE THAT INCOME OF THE ASSESSEE CONSISTING OF INTEREST ON FIXED/SAVING DEP OSITS IS EXEMPT AS THE ASSESSEE IS A MUTUAL ASSOCIATION AND ITS INCOME IS EXEMPT ON THE BASIS OF 'DOCTRINE OF MUTUALITY'. 2. THE LD. AR REFERRING TO THE RECORD HAS SUBMITTED THA T THE ASSESSEE HAD PLACED RELIANCE ON VARIOUS ORDERS OF THE TRIBUNAL AND DECISIONS OF THE HON'BLE HIGH COURT. THE DECISIONS HAVE NOT BEEN CONSIDE RED BY THE CIT(A) AND WITHOUT DISCUSSING HOW THE DECISIONS ON FACTS WE RE NOT RELEVANT OR APPLICABLE, ASSESSEE'S APPEAL HAS BEEN REJEC TED RELYING UPON THE DECISION OF THE APEX COURT IN THE CASE OF BANGALORE C LUB VS CIT (2013) 29 TAXMAN.COM 29. THE ORDER, ACCORDINGLY, WAS STA TED TO BE ITA 63/CHD/2017 A.Y 2011-12 PAGE 2 OF 3 PERVERSE AND CONTRARY TO STATUTORY REQUIREMENTS. ACC ORDINGLY, IT WAS HIS SUBMISSION THAT THE IMPUGNED ORDER MAY BE SET ASIDE. 2.1. ADDRESSING THE FACTS, IT WAS SUBMITTED THAT THE ASSESSE E IS ASSOCIATION OF PERSONS FORMED WITH THE OBJECT TO PROVIDE FINANCIAL ASSISTANCE TO THE, I) EMPLOYEES AND FAMILY MEMBERS OF EMPLOY EES OF THE PUNJAB STATE COOPERATIVE BANK LTD. FOR MEDICAL TREATME NT OF THE EMPLOYEE- MEMBER/DEPENDANTS IN CASE OF SERIOUS ILLNESS OR IN CASE OF ACCIDENT; II) FINANCIAL HELP TO THE FAMILY OF THE EMPLOYEE WHO DI ED DURING THE TENURE OF HIS SERVICE WITH THE BANK DUE TO SOME ACCIDENT OR D ISEASE; III) FINANCIAL HELP TO THE FAMILY OF THE EMPLOYEE WHO HAS BECOME INCAPA CITATED DURING THE TENURE OF HIS SERVICE WITH THE BANK; IV) FINANCIAL HELP FOR HIGHER EDUCATION OF THE CHILDREN OF THE MEMBERS OF THE ASSESSEE'S WELFA RE FUND IN VERY DESERVING CASES. RELIEF WAS REQUESTED ON THE GROUN DS OF MUTUALITY IN RESPECT OF WHICH VARIOUS DECISIONS HAVE BEEN CITED. 3. THE LD. SR.DR SUBMITTED THAT SHE HAS NO OBJECTION IF THE ORDER IS SET ASIDE TO THE CIT(A) FOR CONSIDERING THE DECISIONS RELIED UPO N BY THE ASSESSEE, HOWEVER, IT WAS HER SUBMISSION THAT THE ITAT V IDE ITS ORDER DATED 26.09. 2017 HAD CONSIDERED AN IDENTICAL ISSUE ON THE DOCTRINE O F MUTUALITY IN THE CASE OF ITO VS GYMKHANA CLUB, PANCHKULA IN ITA 1084/CHD/2009 WHEREIN IT HAS BEEN CATEGORICALLY HELD THA T ON THE INTEREST EARNED FROM FIXED DEPOSIT, THE BENEFIT OF DOCTRINE OF MUTUALITY WILL NOT BE AVAILABLE AND THE AMOUNT WOULD BE ELIGIBLE TO TAX. COPY OF THE SAID ORDER WAS FILED AND IT WAS HER REQUEST THAT SAID DEC ISION MAY ALSO BE DIRECTED TO BE CONSIDERED. 4. I HAVE HEARD THE SUBMISSIONS AND PERUSED THE MATERIA L AVAILABLE ON RECORD. IN THE FACTS OF THE PRESENT CASE, THE ASSESSE E HAS CANVASSED THAT THE DECISIONS RELIED UPON IN ITS FAVOUR BEFORE THE CIT(A) HAV E NOT BEEN CONSIDERED. A PERUSAL OF THE RECORD SHOWS THAT THOUGH THE CIT(A) HAS REPRODUCED THE ARGUMENTS ON BEHALF OF THE ASSESSEE, HOW EVER WHY THE SAID ARGUMENTS ARE NOT ACCEPTED HAVE NOT BEEN SET OU T IN THE ORDER AS INSTEAD OF ADDRESSING THE FACTS, HE HAS PROCEEDED STRAIG HTAWAY TO A DISCUSSION ON THE DECISIONS. IN VIEW THEREOF, THE IMPUGNED ORDER CANNOT BE SAID TO BE A SPEAKING ORDER IN TERMS OF THE REQUIREME NTS OF SUB-SECTION (6) OF SECTION 250 OF THE INCOME TAX ACT,1961. ACCORDINGLY , ON ACCOUNT OF THIS FACT AND IN THE LIGHT OF THE SUBMISSIONS OF THE PARTIES BEFORE THE BENCH, THE IMPUGNED ORDER IS HEARD. NEEDLESS TO SAY TH AT THE DECISIONS ITA 63/CHD/2017 A.Y 2011-12 PAGE 3 OF 3 RELIED UPON BY THE PARTIES AND THEIR APPLICABILITY TO THE ISS UES ARE NECESSARILY REQUIRED TO BE CONSIDERED. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 08.01.2018. SD/- (DIVA SINGH) JUDICIAL MEMBER POONAM COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR ASSTT. REGISTRAR ITAT/CHANDIGARH