Axis Bank Ltd., Ahmedabad V. The Addl.CIT, Range-I, Ahmedabad

MA 71/AHD/2018

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 4924 (ITAT-AHMEDABAD)
• Duration Of Justice: 7 month(s) 4 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 10-10-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 06-03-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANTOSH KARNANI
• Keywords: Proportionate interest

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER & MS. MADHUMITA ROY, JUDICIAL MEMBER MA NO.71/AHD/2008 ( IN I.T.A. NO.2196/AHD/2014 ) (ASSESSMENT YEAR : 2009-10) AXIS BANK LTD. (ERSTWHILE KNOWS AS UTI BANK LTD.) TRISHUL OPP. SMTHESHWAR MAHADEV NR.LAW GARDEN, ELLISBRIDGE AHMEDABAD - 380 006 VS. ADDL. CIT RANGE-1 AHMEDABAD [PAN NO.AAACU 2414K ] ( APPLICANT ) .. ( RESPONDENT ) APPL IC ANT BY : SHRI BANDISH SOPARKAR , AR RESPONDENT BY : SHRI SANTOSH KARNANI, DR DATE OF HEARING 20/07/2018 DATE OF PRONOUNCEMENT 10/10/2018 O R D E R PER MS. MADHUMITA ROY - JM: PRESENT MISCELLANEOUS APPLICATION IS DIRECTED AT TH E INSTANCE OF THE ASSESSEE SEEKING RECALL OF TRIBUNALS ORDER DATED 13.10.2017 IN ITA NO.2196/AHD/2014 FOR ASSESSMENT YEAR 2009-10 ON TWO COUNTS: 2. THE LD. TRIBUNAL BY AND UNDER ITS ORDER UPHELD T HE DISALLOWANCE OF ENTIRE ADMINISTRATIVE EXPENSES OF INR 3,33,94,517/- AS MA DE BY THE LD. ASSESSING OFFICER FOR THE AY 2009-10. THE CONTENTION OF THE APPLICANT IS THIS THAT THE ADDITIONAL DISALLOWANCE MADE BY THE LD. ASSESSING OFFICER AND CONFIRMED BY THE LD.CIT(A) FOR THE ADMINISTRATIVE EXPENDITURE OF INR 2,81,09,711/- FOR AY 2008-09 HAS BEEN DELETED BUT - 2 - MA NO.71/AHD/2018 (IN ITA NO.2196/AHD/2014) AXIS BANK LTD. VS. ADDL.CIT ASST.YEAR 2009-10 THIS ASPECT HAS LOST ATTENTION IN THE PRESENT ORDER FOR AY 2009-10 AND INADVERTENTLY THE LD. TRIBUNAL UPHELD DISALLOWANCE OF THE ENTIRE ADMI NISTRATIVE EXPENSES OF INR 3,33,94,517/- AS MADE BY THE LD. ASSESSING OFFICER FOR AY 2009-10. SINCE THE LD. TRIBUNAL ACCEPTED AND FOLLOWED THE ORDER OF THE COO RDINATE BENCH FOR PRECEDING ASSESSMENT YEAR 2008-09, THE ONLY SUO MOTO DISALLOW ANCE OF INR 1,00,21,247/- (CORRESPONDING TO INR 63,84,525/- FOR AY 2008-09) S HOULD BE DISALLOWED UNDER RULE 8D(2)(III) OF THE INCOME TAX RULES, 1962 R.W.S.14A OF THE INCOME TAX ACT. 1961 INSTEAD OF ENTIRE AMOUNT OF INR 3,33,94,517/-. 3. IN THIS ASPECT, WE NEED TO REPRODUCE THE ORDER O F THE LD.TRIBUNAL WHICH IS AS FOLLOWS: 4. WE HAVE HEARD RIVAL SUBMISSIONS. BOTH PARTIES ARE FAIR ENOUGH DURING THE COURSE OF HEARING THAT RELEVANT FACTS PERTAINING TO THE INSTANT ISSUE ARE IDENTICAL AS THEY WERE IN PRECEDING ASSESSMENT YEAR 2008-09 I.E. SINCE APPLICATION OF RULE 8D OF THE INCOME TAX RULES. THE ASSESSEE THEN TAKES U S TO PAPER BOOK PAGES 77 TO 98 CONTAINING A CO-ORDINATE BENCH ORDER DATED 24.01.20 17 FOR PRECEDING ASSESSMENT YEAR DELETING PROPORTIONATE INTEREST DISALLOWANCE O N THE GROUND THAT ASSESSEES INTEREST FREE FUNDS EXCEED ITS TAX FREE INVESTMENTS AMOUNTING TO RS.651 CRORES. IT THEN CONFIRMS LATTER LIMB OF ADMINISTRATIVE DISALLO WANCE AMOUNTING TO RS.63.84 LACS. WE TAKE CUE THEREFROM TO NOTICE THAT ASSESS EES TAX FREE INVESTMENTS IN THE IMPUGNED ASSESSMENT YEAR READ A FIGURE OF RS.684 CR ORES AS AGAINST INTEREST FREE FUND FUNDS IN THE NATURE OF SHARE CAPITAL AND RESER VES AMOUNTING TO RS.10,214 CRORES. WE THEREFORE FIND NO REASON TO CONCUR WITH THE ABOVE PROPORTIONATE INTEREST DISALLOWANCE OF RS.37,11,56,870/-. WE NOW PROCEED TO DEAL WITH ADMINISTRATIVE EXPENDITURE DISALLOWANCE OF RS.3,33, 94,517/-. IT IS NO MORE AN ISSUE THAT THE ABOVE CO-ORDINATE BENCH HAD UPHELD T HE SAME IN PRECEDING ASSESSMENT YEAR. WE THEREFORE ADOPT CONSISTENCY TO AFFIRM THIS LATTER DISALLOWANCE OF ADMINISTRATIVE EXPENDITURE. THIS FIRST SUBSTANT IVE GROUND IS TAKEN AS PARTLY ACCEPTED. 4. WE THEREFORE TAKING INTO CONSIDERATION THE PRAYE R MADE BY THE ASSESSEE, THE ORDER BY DISALLOWING INR 1,00,21,247/- (CORRESPONDING TO INR 63,84,525/- FOR AY 2008-09) - 3 - MA NO.71/AHD/2018 (IN ITA NO.2196/AHD/2014) AXIS BANK LTD. VS. ADDL.CIT ASST.YEAR 2009-10 INSTEAD OF TOTAL EXPENDITURE OF DISALLOWANCE OF INR 3,33,94,517/- IN THE 14 TH LINE OF PARA-4 OF THE TRIBUNAL ORDER. 5. THE ASSESSEE FURTHER PRAYS FOR RECTIFICATION OF THE TERMS SPECULATIVE GAINS BY SECURITISATION GAINS. THE ASSESSEES SUBMISSION IN THIS REGARD IS AS FOLLOWS:- 3.1. AS REGARDS SECOND GROUND OF APPEAL TAKEN UP BY THE BANK, IT IS IN RESPECT OF DISALLOWANCE OF SECURITISATION GAINS OF INR 2,64,27 .796 AMORTISED AS PER RBI GUIDELINES. THIS GROUND IS IN RESPECT FO SECURITIS ATION GAINS. HOWEVER, THE HON.ITAT WHILE ALLOWING THIS GROUND AT PARA 5 (LINE NO.2) AND PARA 6 (LINE NO.2) HAS INADVERTENTLY MENTIONED SPECULATIVE GAINS INS TEAD OF SECURITISATION GAINS. WE HUMBLY SUBMIT THAT SINCE THE NOMENCLATU RE SPECULATIVE IS LITTLE SENSITIVE IN INCOME TAX, WE REQUEST YOUR HONOURS TO SUBSTITUTE THE WORD SPECULATIVE GAINS IN THE PLACE OF SECURITISATION GAINS IN PARA 5 AND 6 OF THE ORDER DATED 13-10-2017. 6. TAKING INTO CONSIDERATION THE ENTIRE ASPECT OF T HE MATTER, WE REJECT THE SECOND LINE OF PARA-6 OF TRIBUNALS ORDER BY MENTIONING SECURI TISATION GAINS INSTEAD OF SPECULATIVE GAINS. 7. ACCORDINGLY, WE RECTIFY THE ORDER OF THE ITA T BENCH A AHMEDABAD PASSED IN ITA NO.2196/AHD/2014 FOR AY 2009-10 DATED 13.10.201 7 TO THE EXTENT AS INDICATED ABOVE. 8. IN THE RESULT, THE MISCELLANEOUS APPLICATION FIL ED BY THE ASSESSEE IS ALLOWED. THIS ORDER PRONOUNCED IN OPEN COURT ON 10/10/2018 SD/- SD/- ( WASEEM AHMED ) ( MS. MADHUMITA ROY ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 10/ 10 /2018 .., . ../ T.C. NAIR, SR. PS - 4 - MA NO.71/AHD/2018 (IN ITA NO.2196/AHD/2014) AXIS BANK LTD. VS. ADDL.CIT ASST.YEAR 2009-10 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPLICANT 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. ( ) / THE CIT(A)-6, AHMEDABAD 5. !'# , $ , / DR, ITAT, AHMEDABAD 6. #() *+ / GUARD FILE. / BY ORDER, ! //TRUE COPY// / ( DY./ASSTT.REGISTRAR) !, / ITAT, AHMEDABAD 1. DATE OF DICTATION .. (DICTATION-PAD 6- PAGES A TTACHED AT THE END OF THIS APPEAL-FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 3. OTHER MEMBER 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 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.22.10.18 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 22.10.18 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