SHREE VYAS DHANVARSHA SAHAKARI BANK LTD,YAWAL V. ITO WARD 1(4) JALGAON, JALGAON

ITA 54/PUN/2025

AI Insights

The case involves Shree Vyas Dhanvarsha Sahakari Bank Ltd., a cooperative bank, which appealed against the order of the CIT(A)/NFAC for the assessment year 2013-14. The primary contention was regarding the reassessment order under section 147 of the IT Act, issued on the basis of a notice under section 148, which the assessee argued was invalid as it did not follow the amended provisions relating to reassessment proceedings. Additionally, the CIT(A) had confirmed the addition of interest receivable on Non-Performing Assets (NPAs) as income, which the assessee argued should only be recognized upon actual realization. The Tribunal found merit in the assessee's request for a re-hearing due to non-receipt of earlier notices and remanded the case back to the CIT(A) for a fresh assessment.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 396350 (ITAT-PUNE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-05-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2013-2014
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KUMAR MANISH SINHA
• Assessee Lawyers: VINAY KWADIA VIRTUAL
• Keywords: Reassessment proceedings; Competent authority
• Section: 148; 142(1)

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “B”, PUNE BEFORE SHRI MANISH BORAD, ACCOUNTANT MEMBER AND SHRI VINAY BHAMORE, JUDICIAL MEMBER आयकर अपील सं. / ITA No.54/PUN/2025 िनधाᭅरण वषᭅ / Assessment Year : 2013-14 Shree Vyas Dhanvarsha Sahakari Bank Ltd., 2944, Main Road, Yawal, Dist. Jalgaon- 425301. PAN : AAALS0041D Vs. ITO, Ward-1(4), Jalgaon. Appellant Respondent आदेश / ORDER PER VINAY BHAMORE, JM: This appeal filed by the assessee is directed against the order dated 12.11.2024 passed by Ld. CIT(A)/NFAC for the assessment year 2013-14. 2. The appellant has raised the following grounds of appeal :- “1) Under the facts and circumstances of the case and in law, the assessment order passed us 147 on 29.03.2022 on the basis of notice u/s 148 issued on 12.04.2021 without following the provisions of section 147 to 151 relating to reassessment proceedings as amended by Finance Act 2021 w.e.f. 01.04.2021 is bad in law and therefore liable to be quashed. Assessee by : Shri Vinay Kwadia (Virtual) Revenue by : Shri Kumar Manish Sinha Date of hearing : 09.04.2025 Date of pronouncement : 30.05.2025 ITA No.54/PUN/2025 2 2) Under the facts and circumstances of the case and in law, the CIT(A), NFAC has erred in confirming the addition made by the AO by treating the interest receivable on Non-Performing Assets (NPAs) of Rs.81,32,393/- as income of the appellant chargeable to tax on accrual basis for AY 2013-14. 3) Under the facts and circumstances of the case and in law, the CIT(A), NFAC has erred in dismissing the appeal without appreciating the facts of the case and without adjudicating any of the grounds of appeal before him. 4) The appellant craves the permission to add, amend, modify, alter, revise, substitute, delete any or all grounds of appeal, if deemed necessary at the time of hearing of the appeal.” 3. Facts of the case, in brief are that the assessee is a cooperative bank and has furnished its return of income on 16.03.2014 by declaring total income of Rs.1,38,446/-. Subsequently, on the basis of information received by the Department that the interest income on NPA was not credited to the profit and loss account, however the same was disclosed in the balance sheet. The case was reopened u/s 147 of the IT Act after obtaining approval from the competent authority and notice u/s 148 on 29.03.2021 and notice u/s 142(1) on 12.11.2021 respectively were issued to the assessee. The assessee neither complied with the above notice nor furnished any return in compliance to notice u/s 148 of the IT Act. However, on 21.02.2022 the assessee furnished a reply that the amount of interest on NPA is shown separately under the hand interest receivable and ITA No.54/PUN/2025 3 the same is treated as income only when it is actually realised and then it is credited to profit and loss account. Not being satisfied with the reply of the assessee, the Assessing Officer completed the assessment by determining total income of Rs.82,70,839/- as against the income returned by the assessee at Rs.1,38,446/-. The above assessed income includes interest on NPA of Rs.81,32,393/-. 4. Since the assessee remained absent, Ld. CIT(A)/NFAC dismissed the appeal filed by the assessee for want of prosecution. It is this order against which the assessee is in appeal before this Tribunal. 5. Ld. AR appearing from the side of the assessee submitted before us that the ex-parte order passed by Ld. CIT(A)/NFAC is unjustified. Ld. AR submitted before us that somehow the notices issued by Ld. CIT(A)/NFAC stored in spam email box and due to this reason the notices of hearing could not be seen by the assessee which resulted in ex-parte order. The Ld. AR requested to provide one opportunity to the assessee to appear before Ld. CIT(A)/NFAC so that the assessee can substantiate the grounds of appeal. ITA No.54/PUN/2025 4 6. Ld. DR appearing from the side of the Revenue supported the orders passed by subordinate authorities and requested to confirm the same. 7. We have heard Ld. Counsels from both the sides and perused the material available on record. The sole prayer made by the Counsel of the assessee that the assessee is a co-operative society doing banking business and providing banking services to general public and if one opportunity is provided to the assessee, he would be in a position to substantiate the grounds of appeal before Ld. CIT(A/NFAC. Considering the totality of the facts of the case and in the interest of justice and without going into merits of the case, we deem it appropriate to set-aside the ex-parte order passed by Ld. CIT(A)/NFAC and remand the matter back to his file with a direction to decide the appeal afresh and as per fact and law after providing reasonable opportunity of hearing to the assessee. The assessee is also hereby directed to comply with the notices issued by Ld. CIT(A)/NFAC in this regard and produce requisite information/documents in support of grounds of appeal without taking any adjournment under any pretext, otherwise Ld. CIT(A)/NFAC shall be at liberty to pass appropriate order as per ITA No.54/PUN/2025 5 law. Thus, the grounds of appeal raised by the assessee in this appeal are partly allowed. 8. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced on this 30th day of May, 2025. Sd/- Sd/- (MANISH BORAD) (VINAY BHAMORE) ACCOUNTANT MEMBER JUDICIAL MEMBER पुणे / Pune; ᳰदनांक / Dated : 30th May, 2025. Sujeet आदेश कᳱ ᮧितिलिप अᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The Pr. CIT concerned. 4. िवभागीय ᮧितिनिध, आयकर अपीलीय अिधकरण, “B” बᱶच, पुणे / DR, ITAT, “B” Bench, Pune. 5. गाडᭅ फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune. "