MUMBAI POSTAL EMPLOYEES CO-OP. CREDIT SOC. LTD., MUMBAI V. PR. CIT -17, MUMBAI

ITA 682/MUM/2021

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 4250 (ITAT-MUMBAI)
• Duration Of Justice: 4 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-09-2021
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Assessment Year: 2015-2016
• Appeal Filed On: 30-04-2021
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SUNIL JHA; NO SUBMISSIONS WERE FILED
• Assessee Lawyers: DEEPAK TIKKEKAR
• Keywords: Revision of order; Set aside
• Section: 263; 143(3)

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, MUMBAI , , BEFORE HONBLE SHRI MAHAVIR SINGH, VP AND HONBLE SHRI MANOJ KUM AR AGGARWAL, AM (HEARING THROUGH VIDEO CONFERENCING MODE) ./ I.T.A. NO. 682 /MUM/ 2021 ( / ASSESSMENT YEAR: 2015 - 16 ) & ./ I.T.A. NO. 681 /MUM/ 2021 ( / ASSESSMENT YEAR: 2016 - 17 ) MUMBAI POSTAL EMPLOYEES C O - OPERATIVE CREDIT SOCIETY LTD. GPO BUILDING, FORT, MUMBAI - 400 001 / VS. P R. C IT 17 R. NO. 120, 1 ST FLOOR, C - 41 TO C - 43, G - BLOCK, KAUTILYA BHAVAN BANDRA KURLA COMPLEX, BANDRA(EAST), MUMBAI - 400 051 ./ ./ PAN/GIR NO. A A AJM - 0032 - G ( / APPELLANT ) : ( / RESPONDENT ) ASSESSEE BY : SHRI DEEPAK TIKKE K AR , LD. AR REVENUE BY : SHRI SUNIL JHA , LD. CIT - DR / DATE OF HEARING : 05 /08 /2021 / DATE OF PRONOUNCEMENT : 14/09/2021 / O R D E R MANOJ K UMAR AGGARWAL (ACCOUNTANT MEMBER) 1. 1 AGGRIEVED BY INVOCATION OF REVISIONAL JURISDICTION U/S 263 FOR ASSESSMENT YEARS (AY) 2015 - 16 & 2016 - 17 BY LEARNED PR. COMMISSIONER OF INCOME TAX - 17, MUMBAI (PR. CIT) VIDE SEPARATE ORDERS DATED 22/01/2021 & 09/03/2021, THE ASSESSEE IS IN FURTHER APPEAL BEFORE US. 2 1.2 THE REGISTRY HAS NOTED A DELAY OF 38 DAYS IN APPEAL FOR AY 2015 - 16, THE CONDONATION OF WHICH HAS BEEN SOUGHT BY THE ASSESSEE ON THE STRENGTH OF AFFIDAVIT OF SHRI MAHESH DHONDIRAJ, SECRETARY OF THE ASSESSEE . IN THE AFFIDAVIT, IT HAS BEEN STATED THAT THE HEARING NOTICES AS WELL AS THE IMPUGNED ORDER WERE ACCESSED BY EMPLOYEES IN THE OFFICE BUT WERE NOT BROUGHT TO THE NOTICE OF CONCERNED OFFICIALS. THE LD. CIT - DR, ON THE OTHER HAND, POINTED OUT THAT THE ASSESS EE DID NOT APPEAR DURING REVISIONAL PROCEEDINGS. 1.3 AFTER GOING THROUGH THE CONTENTS OF THE AFFIDAVIT, THE BENCH FORMED AN OPINION THAT THE DELAY DESERVE TO THE CONDONED AND THE ASSESSEE BE PROVIDED ANOTHER OPPORTUNITY OF HEARING. ACCORDINGLY, THE APPEAL IS ADMITTED AND ADJUDICATED AS GIVEN IN SUCCEEDING PARAGRAPHS. 2. THE ASSESSEE BEING A COOPERATIVE CREDIT SOCIETY WAS ASSESSED FOR AY 2015 - 16 U/S 143(3) ON 28/04/2017. THE ASSESSEE CLAIMED DEDUCTION U/S 80P(2)(A)(I) WHICH WAS ALLOWED IN THE ASSESSMENT ORDE R. 3. HOWEVER, THE ORDER WAS SUBJECTED TO REVISION U/S 263 VIDE ORDER DATED 22/01/2021. IT WAS NOTED THAT THE ASSESSEE CLAIMED DEDUCTION U/S 80P(2) ON INTEREST AND DIVIDEND RECEIPTS. THE INTEREST OF RS.74.50 LACS WAS TAXABLE INCOME. HOWEVER, LD. AO DID NOT MAKE ANY ENQUIRY AS TO ISSUE OF TAXABILITY OF INTEREST INCOME AND THEREFORE, THE ORDER WAS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. ACCORDINGLY, A SHOW - CAUSE NOTICE WAS ISSUED ON 16/03/2020 AND 28/12/2020, HOWEVER , NONE APPEARED FOR ASSES SEE AND NO SUBMISSIONS WERE FILED. ACCORDINGLY, AN OPINION WAS FORMED THAT THE ASSESSEE WAS INELIGIBLE TO CLAIM DEDUCTION IN VIEW OF AMENDED PROVISIONS OF SEC.80P(4), THE FAILURE ON THE PART OF LD. AO MAKE NECESSARY ENQUIRIES AND BRING ON RECORD ALL NECESS ARY FACTS FOR DETERMINING THE TRUE CHARACTER AND NATURE OF INTEREST 3 INCOME ESPECIALLY IN THE LIGHT OF AMENDED PROVISIONS OF SEC.80P(2)(4) HAS MADE THE ORDER AMENABLE TO REVISIONS U/S 263. ACCORDINGLY, THE ORDER WAS SET ASIDE WITH A DIRECTION TO LD. AO TO F RAME DE NOVO ASSESSMENT. AGGRIEVED, THE ASSESSEE IS IN FURTHER APPEAL BEFORE US. 4. THE LD. AR SUBMITTED THAT THE ASSESSEE EARNED INTEREST OF RS.107.52 LACS ON FIXED DEPOSITS HELD WITH MDCC COOPERATIVE BANK AND DIVIDEND INCOME OF RS.17.61 LACS ON SHARES HE LD WITH THE SAME ENTITY. THE LD. AR SUBMITTED THAT SINCE E NTIRE INVESTMENT WAS IN CO - OPERATIVE BANKS , BOTH THESE COMPONENTS WERE ELIGIBLE FOR DEDUCTION U/S 80P(2)(D) . RELIANCE HAS BEEN PLACED ON VARIOUS DECISIONS OF THE TRIBUNAL TO SUPPORT THE SAME. THE L D. AR ALSO SUBMITTED THAT THE ASSESSEE CLAIMED DEDUCTION U/S 80P(2)(A)(I) ON ENTIRE NET PROFIT BASED ON THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF THE QUEPEM URBAN CO - OPERATIVE CREDIT SOCIETY LTD. VS. ASST. CIT (2015) 377 ITR 272 AND VARIOUS OTHER DECISIONS AS ENUMERATED IN THE WRITTEN SUBMISSIONS. THE LD. AR ALSO SUBMITTED THAT LD.AO, HAVING TAKEN POSSIBLE VIEW BASED ON VARIOUS JUDGMENTS, HIS ORDER CANNOT BE SAID TO BE ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF REVENUE . THE LD. CIT - DR, ON THE OTHER HAND, SUBMITTED THAT ALL THESE ARGUMENTS ARE BEING PUT FORTH BY THE ASSESSEE FOR THE FIRST TIME. 5. UPON CAREFUL CONSIDERATION OF ASSESSMENT ORDER, REVISIONAL ORDER AND THE SUBMISSIONS MADE BY BOTH THE PARTIES, WE FIND THAT THERE IS NO MATERIAL DISCUSSION IN THE ASSESSMENT ORDER REGARDING FACTUAL MATRIX AS WELL AS ASSESSEES ELIGIBILITY TO CLAIM DEDUCTION U/S 80P. THE ASSESSEE FAILED TO APPEAR DURING REVISIONAL PROCEEDINGS AND COULD NOT SUBSTANTIATE THE SAME. ALL THESE ARGUMENTS AS PUT FORTH BY L D. A R WERE NOT CONSIDERED BY LD. PR.CIT WHILE SETTING ASIDE THE ASSESSMENT ORDER. 4 THEREFORE, KEEPING IN VIEW THE SAME, WE ARE OF THE CONSIDERED OPINION THAT IT WOULD BE IN THE FITNESS OF THING TO RESTORE THE MATTER OF REVISION BACK TO THE FILE OF LD. PR. C IT TO CONSIDER FACTUAL MATRIX AS WELL AS TO CONSIDER THE ARGUMENTS OF THE ASSESSEE ON THE ISSUE. NEEDLESS TO ADD THAT ADEQUATE OPPORTUNITY OF HEARING SHALL BE GRANTED TO THE ASSESSEE. THE ASSESSEE, IN TURN, IS DIRECTED TO SUBSTANTIATE HIS STAND, IN THIS RE GARD. THE APPEAL STANDS ALLOWED FOR STATISTICAL PURPOSES. 6. FACTS ARE SUBSTANTIALLY THE SAME IN AY 2016 - 17. AN ASSESSMENT WAS FRAMED U/S 143(3) ON 11/12/2018 ACCEPTING THE RETURNED INCOME FILED BY T HE ASSESSEE. THE LD. PR. CIT, IN VOKING REVISIONAL JURISD ICTION U/S 263, SHOW - CAUSED THE ASSESSEE THAT THE ASSESSMENT ORDER WAS PASSED WITHOUT MAKING NECESSARY ENQUIRIES AND VERIFICATIONS. THE ASSESSEE ONLY FILED WRITTEN SUBMISSION AND RELIED ON FEW JUDICIAL PRONOUNCEMENTS. HOWEVER, BASED ON CERTAIN JUDICIAL DEC ISIONS, LD. PR. CIT, HELD THAT THE INTEREST INCOME WAS NOT ELIGIBLE FOR DEDUCTION U/S 80P(2)(A)(I) AND THEREFORE, LD.AO WAS DIRECTED TO REDO THE ASSESSMENT ON SIMILAR LINES. AGGRIEVED, THE ASSESSEE IS IN FURTHER APPEAL BEFORE US. 7. SINCE THE FACTS AS WELL AS ISSUES ARE PARI - MATERIA THE SAME AS IN AY 2015 - 16, OUR FINDINGS AS WELL AS ADJUDICATION AS FOR AY 2015 - 16 SHALL MUTATIS - MUTANDIS APPLY TO THIS YEAR ALSO. ACCORDINGLY, THE REVISIONAL ORDER DATED 09/03/2021 IS SET - ASIDE AND THE MATTER OF REVISION STAND R ESTORED BACK TO THE FILE OF LD. PR. CIT WITH SIMILAR DIRECTIONS. THE APPEAL STANDS ALLOWED FOR STATISTICAL PURPOSES. 8. BOTH THE APPEAL STANDS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON 14 TH SEPTEMBER , 2021 . SD/ - SD/ - (MAHAVIR SINGH) (MANOJ KUMAR AGGARWAL) / VICE PRESIDENT / ACCOUNTANT MEMBER 5 MUMBAI; DATED : 14/09/2021 SR.PS, DHANANJAY / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT CONCERNED 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE / BY ORDER, / (DY./ASSTT.REGISTRAR) , / ITAT, MUMBAI.