The Morazha Kallisserri Service Co-op Bank Ltd, Kannur V. The ITO, Kannur

MA 4/COCH/2017

• Counselvise Citation: [2017] 124 COUNSELVISE.COM (IT) 5336 (ITAT-COCHIN)
• Duration Of Justice: 2 month(s) 10 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 17-03-2017
• Appeal Filed By: Assessee
• Bench Allotted: DB
• Assessment Year: 2007-2008
• Appeal Filed On: 07-01-2017
• Court: TRIBUNAL
• Department Lawyers: A DHANARAJ
• Assessee Lawyers: R KRISHNA IYER
• Keywords: Competent authority; Benefit of exemption

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE S/SHRI ABRAHAM P. GEORGE, AM & GEORGE GEORGE K., JM M.P. NOS. 04 - 07/COCH/2017 (I.T.A. NOS.725-728/COCH/2013) ASSESSMENT YEAR : THE MORAZHA - KALLIASSERI SERVICE CO-OP BANK LTD., ANCHAMPEEDIKA, KANNUR-670 331. [PAN: AAAAT 9657M] VS. THE I NCOME T AX OFFICER , WARD - 1, KANNUR. (ASSESSEE - APPELLANT) ( REVENUE - RESPONDENT) ASSESSEE BY SHRI R. KRISHNA IYER, CA REVENUE BY SHRI A. DHANARAJ, SR. DR DATE OF HEARING 17 / 0 3 / 201 7 DATE OF PRONOUNCEMENT 17 / 0 3 /201 7 O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER: ASSESSEE THROUGH THESE MISCELLANEOUS PETITIO NS SEEKS RECALL OF THE ORDER OF THE TRIBUNAL DATED 17/10/2014 IN I.T.A. NOS.725-728 /COCH/2013. 2. LD. AR SUBMITTED THAT THE TRIBUNAL HAD DECIDED THE QUESTION OF DEDUCTION U/S. 80P(2) OF THE INCOME TAX ACT, 1961(IN SHORT T HE ACT), BASED ON THE EARLIER BENCH DECISION IN THE CASE OF PINARAYI SERVICE CO-O PERATIVE BANK LTD., KANNUR VS. M.P. NOS.04-07/COCH/2017 2 ITO (2015) 162 ITD 90. AS PER LD. AR ASSESSEE WA S A PRIMARY AGRICULTURAL CREDIT SOCIETY REGISTERED UNDER THE KERALA CO-OPERA TIVE SOCIETIES ACT, 1969 AND BY VIRTUE OF JUDGMENT OF HONBLE JURISDICTIONAL HIG H COURT IN THE CASE OF CHIRAKKAL SERVICE CO-OPERATIVE BANK LTD. V. CIT (384 ITR 490) ELIGIBLE FOR DEDUCTION U/S. 80P(2) OF THE ACT. AS PER LD. AR, THE SAID JUDGMEN T OF THE JURISDICTIONAL HIGH COURT WAS RENDERED SUBSEQUENT TO THE ORDER OF THE T RIBUNAL. RELYING ON THE JUDGMENT OF THE APEX COURT IN THE CASE OF ACIT VS. SAURASHTRA KUTCH STOCK EXCHANGE LTD. (305 ITR 227), FULL BENCH JUDGMENT OF HONBLE PUNJAB & HARYANA HIGH COURT IN CIT VS. SMT. ARUNA LUTHRA (252 ITR 76 ), AND THAT OF HONBLE KERALA HIGH COURT IN THE CASE OF KIL KOTAGIRI TEA AND COPP ER ESTATES CO. LTD. VS. ITAT & OTHERS (174 ITR 579), LD. AR SUBMITTED THAT THE SU BSEQUENT JUDGMENT OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CH IRAKKAL SERVICE CO-OPERATIVE BANK LTD. (SUPRA) GAVE AN EXPOSITION OF LAW WITH RE GARD TO APPLICATION OF SECTION 80P(2), WAS A GOOD REASON FOR RECTIFYING THE ORDER OF THE TRIBUNAL. AS PER LD. AR, ASSESSEE WAS A PRIMARY AGRICULTURAL CREDIT SOCI ETY AND HAD PROVIDED CERTIFICATE TO THIS EFFECT BEFORE THE LOWER AUTHORI TIES, BUT IT WAS CONSIDERED AS A CO-OPERATIVE BANK AND DENIED DEDUCTION U/S. 80P(2) OF THE ACT. IT WAS ALSO SUBMITTED BY LD. AR THAT DISALLOWANCE U/S. 40(A)(IA ) OF THE ACT FOR NON DEDUCTION OF TAX AT SOURCE ON INTEREST PAID ON DEPOSITS WAS A LSO CONFIRMED BY THIS TRIBUNAL AGAIN RELYING ON THE VERY SAME DECISION OF THE CO-O RDINATE BENCH IN THE CASE OF PINARAYI SERVICE CO-OPERATIVE BANK LTD. (SUPRA). O NCE THE ASSESSEE WAS FOUND TO BE ELIGIBLE FOR CLAIM OF EXEMPTION U/S. 80P OF T HE ACT, AS PER LD. AR, IT WOULD M.P. NOS.04-07/COCH/2017 3 GET BENEFIT OF EXEMPTION U/S. 194A(3)(VIIA) OF THE ACT AND COULD NOT BE SADDLED WITH A LIABILITY TO DEDUCT TAX AT SOURCE ON INTERES T PAID. 3. PER CONTRA, LD. DR SUBMITTED THAT SUBSEQUENT J UDGMENT OF THE HONBLE JURISDICTIONAL HIGH COURT WOULD NOT BE SUFFICIENT E NOUGH REASON FOR SEEKING RECTIFICATION. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSE D THE ORDERS. IT HAS NOT BEEN DISPUTED BY THE REVENUE THAT IN THE CASE OF CHIRAKK AL SERVICE-CO-OPERATIVE BANK LTD. (SUPRA), THE HONBLE JURISDICTIONAL HIGH COURT HELD AN ASSESSEE CERTIFIED BY A COMPETENT AUTHORITY AS A PRIMARY AGRICULTURAL CREDI T SOCIETY UNDER KERALA CO- OPERATIVE SOCIETIES ACT, 1969, TO BE ENTITLED TO TH E CLAIM OF DEDUCTION U/S. 80P(2) OF THE ACT. ASSESSEE HERE, HAD PRODUCED CER TIFICATE FROM THE COMPETENT AUTHORITY BEFORE THE LOWER AUTHORITIES. WHEN THE T RIBUNAL ORIGINALLY DISPOSED OFF THE APPEAL, THE ABOVE JUDGMENT OF HONBLE JURISDICT IONAL HIGH COURT WAS NOT AVAILABLE, AND TRIBUNAL HAD TAKEN A VIEW ADVERSE TO THE ASSESSEE. WHETHER SUBSEQUENT JUDGMENT OF HONBLE JURISDICTIONAL HIGH COURT WILL BE A SUFFICIENT REASON TO GRANT A RECTIFICATION, HAS BEEN ELABORATE LY DEALT WITH BY HONBLE APEX COURT IN THE CASE OF ACIT VS. SAURASHTRA KUTCH STOC K EXCHANGE LTD., (SUPRA). IT WAS HELD THAT EXPOSITION OF LAW BY JURISDICTIONAL H IGH COURT WILL BE RETROACTIVE, OR IN OTHER WORDS, EXPLAINED THE LAW AS IT WAS FROM TH E BEGINNING. WE ARE OF THE OPINION THAT SINCE THE SUBSEQUENT JUDGMENT OF HONB LE JURISDICTIONAL HIGH COURT M.P. NOS.04-07/COCH/2017 4 IN THE CASE OF CHIRAKKAL SERVICE-CO-OPERATIVE BANK LTD. (SUPRA) HAD IMPLIEDLY OVERRULED THE IMPUGNED ORDER OF THE TRIBUNAL, IT HA S TO BE RECALLED. WE, THEREFORE, RECALL THE IMPUGNED ORDERS OF THE TRIBUN AL AND DIRECT THE REGISTRY TO POST IT FOR FRESH HEARING IN DUE COURSE. IN THE RESULT, THE MISCELLANEOUS PETITIONS OF THE ASSESSEE ARE ALLOWED. PRONOUNCED IN THE OPEN COURT ON 17-03-2017. SD/- SD/- (GEORGE GEORGE K.) ( ABRAHAM P. GEORGE) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE: KOCHI DATED: 17 TH MARCH, 2017 GJ COPY TO: 1. THE MORAZHA-KALLIASSERI SERVICE CO-OP BANK LTD., ANCHAMPEEDIKA, KANNUR-670 331. 2. THE INCOME TAX OFFICER, WARD-1, KANNUR. 3. THE COMMISSIONER OF INCOME-TAX(APPEALS),KOZHIKOD E. 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., COC HIN