M/s.Mannarkkad Rural Service Co-op Bank Ltd, Palakkad V. The ITO,Wd-4, Palakkad

MA 74/COCH/2019

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 2395 (ITAT-COCHIN)
• Duration Of Justice: 1 month(s) 3 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 04-09-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 30-08-2019
• Assessment Year: 2013-2014
• Appeal Filed On: 31-07-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A S BINDHU
• Assessee Lawyers: SIVADAS CHITTOOR
• Section: 154; 80P

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE SHRI CHANDRA POOJAR I, AM & SHRI GEORGE GEORGE K, JM MA NO. 60 /COCH/201 9 : ASST.YEAR 2013 - 2014 (ARISING OUT OF ITA NO. 532 /COCH/201 8 ) THE INCOME TAX OFFICER WARD 4 PALAKKAD. VS. M/S.MANNARKKAD RURAL SERVICE CO - OPERATIVE BANK LIMITED, NO.F - 8/767 MANNARKKAD PALAKKAD 678 582. PAN : AABAT5781D. ( APPLICANT ) (RESPONDENT) MA NO. 74 /COCH/201 9 : ASST.YEAR 2013 - 2014 (ARISING OUT OF ITA NO. 532 /COCH/201 8 & CO NO.88/COCH/2018 ) M/S.MANNARKKAD RURAL SERVICE CO - OPERATIVE BANK LIMITED, NO.F - 8/767 MANNARKKAD PALAKKAD 678 582. VS. THE INCOME TAX OFFICER WARD 4 PALAKKAD. ( APPLICANT ) (RESPONDENT) REVENUE BY : SMT.A.S.BINDHU, SR.DR ASSESSEE BY : SRI.SIVADAS CHITTOOR DATE OF HEARING : 30 .0 8 .2019 DATE OF PRONOUNCEMENT : 04 .0 9 .2019 O R D E R PER GEORGE GEORGE K., JM THESE MISCELLANEOUS APPLICATIONS ARE SEEKING TO RECALL THE TRIBUNAL ORDER DATED 17.01.2019. MA NO.60/COCH/2019 AT THE INSTANCE OF THE REVENUE ARISES OUT OF ITA NO.532/COCH/2018 AND MA NO.74/COCH/ 2019 AT THE INSTANCE OF THE ASSESSEE ARISES OUT OF CO NO.88/ COCH/2018. M A NO S . 60 & 74 / COCH /201 9 . M/S. MANNARKKAD RURAL SCB LIMITED. 2 WE SHALL FIRST ADJUDICATE MA NO.60/COCH/2018 FILED AT THE INSTANCE OF THE REVENUE. MA NO.60/COCH/2018 2. BRIEF FACTS OF THE CASE ARE AS FOLLOWS: THE ASSESSEE IN THIS CASE IS A PRIMARY AGRICULTURAL CREDIT SOCIETY REGISTERED UNDER THE KERALA CO - OPERATIVE SOCIETIES ACT, 1969. THE ASSESSEES CLAIM OF DEDUCTION U/S 80P OF THE IT.ACT WAS DENIED BY THE ASSESSING OFFICER BY TREATING THE ASSESSEE AS CO - OPE RATIVE BANK AND NOT PRIMARY AGRICULTURAL CREDIT SOCIETY. 3. THE ASSESSEE AGGRIEVED BY THE DENIAL OF DEDUCTION U/S 80P OF THE I.T.ACT FILED APPEALS BEFORE THE FIRST APPELLATE AUTHORITY. THE FIRST APPELLATE AUTHORITY BY FOLLOWING THE JUDGMENT OF THE HONBL E KERALA HIGH COURT IN THE CASE OF CHIRAKKAL SERVICE CO - OPERATIVE BANK LTD. REPORTED IN 384 ITR 490 ALLOWED THE APPEALS OF THE ASSESSEE AND DIRECTED THE ASSESSING OFFICER TO GRANT DEDUCTION U/S 80P(2) OF THE I.T.ACT AS THE ASSESSEE IS CLASSIFIED AS PRIMARY AGRICULTURAL CREDIT SOCIETY BY THE REGISTRAR OF CO - OPERATIVE SOCIETIES. 4. ON FURTHER APPEALS BY THE REVENUE, THE VIEW TAKEN BY THE CIT(A) WAS CONFIRMED BY THE TRIBUNAL VIDE ITS CONSOLIDATE ORDER DATED 17.01.2019 IN ITA NO.532/COCH/2018 . 5. THE REVENU E BEING AGGRIEVED BY THE CONSOLIDATE ORDER OF THE TRIBUNAL DATED 17.01.2019, HAS FILED THIS MISCELLANEOUS APPLICATION TO RECALL ITA NO.532/COCH/2018 . THE LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE LARGER M A NO S . 60 & 74 / COCH /201 9 . M/S. MANNARKKAD RURAL SCB LIMITED. 3 BENCH OF THE HONBLE KERALA HIGH COURT I N THE CASE OF THE MAVILAYI SERVICE CO - OPERATIVE BANK LTD. V. CIT [ITA NO.97/2016 ORDER DATED 19 TH MARCH, 2019] HAS REVERSED DICTUM LAID DOWN BY THE HONBLE KERALA HIGH COURT IN THE CASE OF CHIRAKKAL SERVICE CO - OPERATIVE BANK LTD. (SUPRA). IT WAS STATED THA T THE FULL COURT OF THE HONBLE HIGH COURT HAD CATEGORICALLY HELD THAT CERTIFICATE CHARACTERIZING A CO - OPERATIVE SOCIETY AS PRIMARY AGRICULTURAL SOCIETY IS NOT A CONCLUSIVE PROOF BUT ACTIVITIES OF ASSESSEE HAS TO BE EXAMINED BY THE A.O. IN EACH ASSESSMENT YEARS TO DETERMINE WHETHER ASSESSEE IS CO - OPERATIVE SOCIETY OR CO - OPERATIVE BANK. IT WAS SUBMITTED THAT IN VIEW OF THE LARGER BENCH JUDGMENT OF THE HONBLE KERALA HIGH COURT THERE IS A MISTAKE APPARENT IN THE ORDER OF THE TRIBUNAL DATED 17.01.2019 AND THE SAME NEEDS TO BE RECTIFIED. THE LEARNED AR, HOWEVER, SUBMITTED THAT THERE IS NO MISTAKE APPARENT FROM RECORD SINCE AS ON THE DATE OF PASSING THE ORDER BY THE TRIBUNAL, THE LAW THAT WAS PREVAILING WAS THE LAW LAID DOWN BY THE HONBLE JURISDICTIONAL HIGH CO URT IN THE CASE OF CHIRAKKAL SERVICE CO - OPERATIVE BANK LTD. (SUPRA) . 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. IN THIS CASE, THE FIRST APPELLATE AUTHORITY AND THE TRIBUNAL HAD ALLOWED THE CLAIM OF DEDUCTION U/S 80P OF THE I.T.ACT BY FOLLOWING THE JUDGMENT OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CHIRAKKAL SERVICE CO - OPERATIVE BANK LTD. (SUPRA). CERTAIN ISSUES DECIDED IN THE CASE OF CHIRAKKAL SERVICE CO - OPERATIVE BANK LTD. (SUPRA) WAS REVERSED BY THE LARGER BENCH OF THE HONBLE KERALA HIGH COURT IN THE CASE OF THE MAVILAYI SERVICE CO - OPERATIVE BANK LTD. V. CIT (SUPRA). THE LARGER BENCH OF THE HONBLE KERALA M A NO S . 60 & 74 / COCH /201 9 . M/S. MANNARKKAD RURAL SCB LIMITED. 4 HIGH COURT HAD HELD THAT EACH ASSESSMENT YEAR IS SEPARATE AND FOR EACH OF THE ASSESSMENT YEAR NECESSARI LY AN INQUIRY HAS TO BE CONDUCTED BY THE A.O. INTO THE FACTUAL SITUATION WHETHER THE CO - OPERATIVE SOCIETIES ARE CARRYING ON THE ACTIVITIES IN ACCORDANCE WITH THE ACTIVITIES MENTIONED UNDER THE KERALA CO - OPERATIVE SOCIETIES ACT, 1969. IT WAS HELD BY THE LAR GER BENCH OF THE HONBLE KERALA HIGH COURT THAT THE CHARACTERIZATION OF A CO - OPERATIVE SOCIETY AS A PRIMARY AGRICULTURAL CREDIT SOCIETY WOULD NOT SUFFICE AND IN EACH OF THE ASSESSMENT YEAR THE ACTIVITIES OF ASSESSEES SHOULD BE EXAMINED TO DETERMINE WHETHER THEY WERE ACTUALLY A CO - OPERATIVE SOCIETY OR CO - OPERATIVE BANK. IN THE CIT(A)S ORDER AND THE TRIBUNALS ORDER, NO EXAMINATION OF THE ACTIVITIES OF THE ASSESSEE WAS CARRIED OUT. THE TRIBUNAL HAD DIRECTED TO GRANT DEDUCTION U/S 80P OF THE I.T.ACT BY MERELY PERUSING THE CERTIFICATE ISSUED BY THE REGISTRAR OF CO - OPERATIVE SOCIETIES CHARACTERIZING THE ABOVE ASSESSEE AS A PRIMARY AGRICULTURAL CREDIT SOCIETY. 6.1 THE HONBLE KERALA HIGH COURT IN THE CASE OF KIL KOTAGIRI TEA & COFFEE ESTATES CO. LTD. V. ITAT REPORTED IN 174 ITR 579 HAD HELD THAT WHEN AN AUTHORITY HAS DECIDED ON THE BASIS OF A DECISION OF THE HIGH COURT WHICH IS SUBSEQUENTLY REVERSED, THERE WOULD BE A RECTIFIABLE MISTAKE COMING WITHIN THE SECTION 154 OF THE INCOME - TAX ACT. THE LARGER BENCH OF T HE HONBLE KERALA HIGH COURT HAS REVERSED THE DICTUM LAID DOWN BY THE JUDGMENT OF THE HONBLE KERALA HIGH COURT IN THE CASE OF CHIRAKKAL SERVICE CO - OPERATIVE BANK LTD. (SUPRA) BY HOLDING THAT THE ACTIVITIES OF THE ASSESSEE HAS TO BE EXAMINED TO DETERMINE W HETHER THE ASSESSEE IS CO - OPERATIVE SOCIETY OR CO - M A NO S . 60 & 74 / COCH /201 9 . M/S. MANNARKKAD RURAL SCB LIMITED. 5 OPERATIVE BANK. IN THE LIGHT OF THE LARGER BENCH JUDGMENT OF THE HONBLE KERALA HIGH COURT, THE TRIBUNAL ORDER DATED 17.01.2019 IN ITA NO.532/COCH/2018 , SUFFERS FROM A MISTAKE APPARENT ON RECORD AND THE SAM E NEEDS TO BE RECALLED. ACCORDINGLY THE ORDER OF THE TRIBUNAL DATED 17.01.2019 IS RECALLED AND THE SAME IS POSTED FOR HEARING ON 19.09 .2019. MA NO. 74/COCH/2019 7. THIS MISCELLANEOUS APPLICATION AT THE INSTANCE OF THE ASSESSEE IS SEEKING TO RECALL THE ORDER OF THE TRIBUNAL IN C.O. NO.88/COCH/2018. THE CO NO.88/COCH/2018 ARISES OUT OF THE REVENUES APPEAL IN ITA NO.532/COCH/2018. SINCE WE HAVE RECALLED THE TRIBUNAL ORDER IN ITA NO.532/COCH/2018 AND HAVE POSTED THE CASE FOR HEARING, NECESSARILY, THE C.O. NO.88/COCH/2018 ARISING OUT OF ITA NO.532/COCH/2018 IS ALSO RESTORED AND POSTED FOR HEARING ALONG WITH ITA NO.532/COCH/2018. IT IS ORDERED ACCORDINGLY. 8 . IN THE RESULT, THE MISCELLANEOUS APPLICATION S FILED BY THE REVENUE AND ASSESS EE ARE ALLOWED. ORDER PRONOUNCED ON THIS 04 TH DAY OF SEPTEMBER , 2019 . SD/ - SD/ - ( CHANDRA POOJARI ) ( GEORGE GEORGE K. ) ACCOUNTANT MEMBER JUDICIAL MEMBER COCHIN ; DATED : 04 TH SEPTEMBER , 2019. DEVDAS* M A NO S . 60 & 74 / COCH /201 9 . M/S. MANNARKKAD RURAL SCB LIMITED. 6 COPY OF THE ORDER FORWARDED TO : BY ORDER, AR - ITAT - COCHIN 1. THE APPLICANT . 2. THE RESPONDENT. 3. THE CIT(A) - KOZHIKODE. 4. THE PR.CIT, KOZHIKKODE . 5. DR, ITAT, COCHIN 6 . GUARD FILE.