Union Bank Co-Operative Credit Society Ltd., Ahmedabad V. The Income Tax Officer, Ward-1(3)(5), Ahmedabad

ITA 838/AHD/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 8052 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 2 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-06-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Appeal Filed On: 05-04-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL

Judgement Text

, LH LHLH LH IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHMEDABAD LOZJH LOZJH LOZJH LOZJH OLHE VGEN OLHE VGEN OLHE VGEN OLHE VGEN] YS[KK LNL; ,OA ] YS[KK LNL; ,OA ] YS[KK LNL; ,OA ] YS[KK LNL; ,OA EK/KQFERK JKW; EK/KQFERK JKW; EK/KQFERK JKW; EK/KQFERK JKW;] U;KF;D LNL; ] U;KF;D LNL; ] U;KF;D LNL; ] U;KF;D LNL; DS LE{KA DS LE{KA DS LE{KA DS LE{KA BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER AND SMT MADHUMITA ROY, JUDICIAL MEMBER 1. ./ I.T.A. NO.488/AHD/2018 FOR A.Y. 2014-15 2. ./ I.T.A. NO.838/AHD/2017 FOR A.Y. 2013-14 UNION BANK CO-OP CREDIT SOCIETY LTD., DHANLAXMI MARKET, RAILWAY PURA, AHMEDABAD 380 002 / VS. THE INCOME TAX OFFICER, WARD 1(3)(5), AHMEDABAD. ./ ./ PAN/GIR NO. : AAAAU 0802 F ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI PRITESH SHAH, A.R. / RESPONDENT BY : SHRI PRASOON KABRA, SR. D.R. / DATE OF HEARING 26/06/2018 !'# / DATE OF PRONOUNCEMENT 28/06/2018 $% / O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER: THE CAPTIONED APPEALS HAVE BEEN FILED AT THE INSTAN CE OF THE ASSESSEE AGAINST THE SEPARATE APPELLATE ORDERS OF THE COMMIS SIONER OF INCOME TAX(APPEALS)-10, AHMEDABAD [CIT(A) IN SHORT] VIDE APPEALS NOS.CIT(A)-10/WARD-1(3)(5)/10821/2016-17 & CIT(A)-1 0/ITO WARD- (3)(5)/364/15-16 DATED 24.01.2018 & 15.02.2017 ARIS ING IN THE ASSESSMENT ORDER PASSED UNDER S.143(3) OF THE INCOM E TAX ACT, 1961 (HERE-IN-AFTER REFERRED TO AS 'THE ACT') DATED 29. 11.2016 & 30.12.2015 RELEVANT TO ASSESSMENT YEARS (AYS) 2014-15 & 2013-1 4. ITA NO.488/AHD/2018 & 838/ AHD/2017 UNION BANK CO-OP CRE DIT SOCIETY LTD. VS. ITO ASST.YEARS 2014-15 & 2013-14 - 2 - SINCE THE COMMON ISSUE IS ARISING IN BOTH THE APPEA LS FILED BY ASSESSEE, THEREFORE, BOTH THE APPEALS ARE HEARD TOGETHER AND ARE BEING DISPOSED OF BY WAY OF A CONSOLIDATED ORDER FOR THE SAKE OF BREV ITY. 2. GROUND OF APPEAL RAISED BY THE ASSESSEE IN ITA N O.488/AHD/2018 IS AS UNDER:- THE LEARNED CIT(A) ERRED IN LAW AND ON THE FACTS O F THE CASE IN CONFIRMING THE DISALLOWANCE OF RS.24,85,164/- UNDER SECTION 80(2)(A)(I) OF THE INCOME TAX ACT, 1961, SUCH DEDUCTION IS REQU ESTED TO BE ALLOWED. 3. GROUND OF APPEAL RAISED BY THE ASSESSEE IN ITA N O.838/AHD/2017 IS AS UNDER: THE LEARNED CIT(A) ERRED IN LAW AND ON THE FACTS I N CONFIRMING THE DISALLOWANCE OF DEDUCTION OF RS.13,77,963/- UNDER S ECTION 80P OF THE INCOME TAX ACT, 1961, WE REQUEST TO GRANT DEDUCTION UNDER SECTION 80P OF THE INCOME TAX ACT, 1961. 4. THE SOLITARY ISSUE INVOLVED IN BOTH OF APPEALS R ELATES TO WHETHER INTEREST INCOME EARNED ON FIXED DEPOSITS WITH THE N ATIONALIZED BANK WOULD QUALIFY FOR DEDUCTION UNDER SECTION 80P(2)(A) (I) OF THE INCOME TAX ACT. 5. AT THE OUTSET, THE LEARNED COUNSEL FOR THE ASSE SSEE FAIRLY CONCEDED THAT ISSUE IN DISPUTE IS SQUARELY COVERED AGAINST T HE ASSESSEE BY THE DECISION OF THE HON'BLE JURISDICTIONAL HIGH COURT I N THE CASE OF STATE BANK OF INDIA VS. CIT, 389 ITR 578 WHEREIN HON'BLE COURT HELD THAT INTEREST EARNED FROM THE INVESTMENT MADE IN ANY BAN K IS NOT DEDUCTIBLE ITA NO.488/AHD/2018 & 838/ AHD/2017 UNION BANK CO-OP CRE DIT SOCIETY LTD. VS. ITO ASST.YEARS 2014-15 & 2013-14 - 3 - UNDER SECTION 80P(2)(A)(I) OF THE ACT. IN THIS VIEW OF THE MATTER, WE DISMISS THE APPEAL OF THE ASSESSEE. HOWEVER, WE DIR ECT THE AO TO EXCLUDE THE AMOUNT OF NET INTEREST INCOME FROM THE DEDUCTIO N CLAIMED U/S 80P(2)(A)(I) OF THE ACT. THUS THE AO WILL ALLOW THE EXPENSES INCURRED BY THE ASSESSEE IN THE EARNING OF SUCH INTEREST INCOME NOT ELIGIBLE FOR DEDUCTION UNDER SECTION 80P(2)(A)(I) OF THE ACT. IN OTHER WORDS, THE LD.AO HAS TO DETERMINE THE NET INTEREST INCOME EARNED BY THE ASSESSEE ON SUCH INVESTMENT WITH THE BANK, A ND ONLY AFTER THAT NET INTEREST INCOME HAS TO BE EXCLUDED FROM THE ADMISSI BILITY OF DEDUCTION UNDER SECTION 80P(2) OF THE ACT. HENCE, GROUNDS OF APPEAL FILED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 6. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEE ARE PARTLY ALLOWED FOR STATISTICAL PURPOSE. THIS ORDER PRONOUNCED IN OPEN COURT ON 28/06/2018 SD/- SD/- E/KQFERK JKW; E/KQFERK JKW; E/KQFERK JKW; E/KQFERK JKW; OLHE OLHE OLHE OLHE VGEN VGEN VGEN VGEN U;KF;D LNL; U;KF;D LNL; U;KF;D LNL; U;KF;D LNL; YKS[KK LN YKS[KK LN YKS[KK LN YKS[KK LN L; L; L; L; (MADHUMITA ROY) (WASEEM AHMED) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED 28/06/2018 PRITI YADAV, SR.PS ITA NO.488/AHD/2018 & 838/ AHD/2017 UNION BANK CO-OP CRE DIT SOCIETY LTD. VS. ITO ASST.YEARS 2014-15 & 2013-14 - 4 - ! ' / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. & '( ) / CONCERNED CIT 4. ) () / THE CIT(A)-10, AHMEDABAD. 5. ,-. //'( , '(# , 12$&$ / DR, ITAT, AHMEDABAD 6. .34 5 / GUARD FILE. # $ / BY ORDER, , / //TRUE COPY// %/$ &' ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION 27/06/2018 . 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 27/06/2018. 3. OTHER MEMBER 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S 27/06/2018 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S. 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER