WARANGAL URBAN CO-OPERATIVE BANK LIMITED,HYDERABAD V. ACIT., CIRCLE-1, HYDERABAD

SA 32/HYD/2024

AI Insights

The case involves the Warangal Urban Co-operative Bank Limited, which filed a stay application against an outstanding tax demand for the assessment year 2015-16. The demand arose from disallowances made under Section 40(a)(ia), provisions for Non-Performing Assets (NPA), and amortization of premiums on government securities. The CIT(A) had deleted the addition under Section 40(a)(ia) but sustained the other additions. The bank, represented by Shri P. Murali Mohan Rao, argued financial distress and adherence to RBI guidelines necessitating the provisions and amortizations. The tribunal, considering the inability of the bank to pay 20% of the demand and the upcoming hearing date, decided to prepon the hearing instead of granting the stay.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 46486 (ITAT-HYDERABAD)
• Duration Of Justice: 24 day(s)
• Appeal Type: Others
• Pronouncement Date: 22-11-2024
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB-B
• Next Hearing Date: 22-11-2024
• Assessment Year: 2015-2016
• Appeal Filed On: 29-10-2024
• Laws Referred To: Section 40(a)(ia) of the Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: P. MURALI MOHAN RAO
• Keywords: Application of stay
• Section: 40(a)(ia)

Judgement Text

"आयकर अपीलीय अधिकरण, हैदराबाद पीठ में IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES “B” , HYDERABAD BEFORE SHRI VIJAY PAL RAO, HON’BLE VICE PRESIDENT AND SHRI MANJUNATHA G. HON’BLE ACCOUNTANT MEMBER S.A No.32/Hyd/2024 in ITA No.693/Hyd/2024 Assessment Year: 2015-16 Warangal Urban Co-operative Bank Limited, Hyderabad. PAN : AAAAW0651J Vs. The Assistant Commissioner of Income Tax, Circle – 1, Hyderabad. (Appellant) (Respondent) Assessee by: Shri P. Murali Mohan Rao Revenue by: None. Date of hearing: 22.11.2024 Date of pronouncement: 22 .11.2024 O R D E R PER MANJUNATHA G. A.M: The present stay application filed by the assessee seeking stay for outstanding demand of tax and interest of Rs.26,61,844/- relates to the assessment year 2015-16. 2 SA 32/Hyd/2024 2. The learned counsel for the assessee Shri P. Murali Mohan Rao, C.A. referring to the application filed by the assessee for the stay of outstanding tax demand, submitted that, Assessing Officer made disallowance under Section 40(a)(ia), addition towards provision for NPA and disallowance of amortization of premium paid on government securities. However, the LD.CIT(A) deleted the addition made under Section 40(a)(ia) of the Act, but sustained additions made towards provision for NPA and amortization of premium paid on government securities. The learned counsel for the assessee further contended that the appellant is having prima facie case on merits, because as per the RBI guidelines, the appellant needs to make provision for NPA and also debit towards amortization of premium paid on government securities. He further submitted that the assessee cannot make any payment towards outstanding tax demand due to financial distress and working capital requirement. He, therefore, submitted that till disposal of the appeal, stay may be granted for the outstanding tax demand. 3. None appeared for the Revenue. 4. We have heard the ld.AR Shri P. Murali Mohan Rao, C.A. and considered the relevant reasons given by the appellant in the petition filed for seeking stay of outstanding tax demand, and we find that the appeal filed by the assessee is posted for hearing on 3 SA 32/Hyd/2024 23-12-2024. Since the appellant expressed its inability to pay 20% of the outstanding tax demand, as required under the statute, in our considered view, instead of granting stay for outstanding tax demand, the appeal may be preponed for hearing and disposal. In view of the above, we dismiss the stay application filed by the assessee, preponed the appeal and posted on 26.11.2024. We further, direct the Assessing Officer not to enforce the tax demand till next date of hearing. The next date of hearing is informed to the Counsel for the assessee and the revenue in the open Court. 5. In the result, the stay application filed by the assessee is dismissed in terms of the observations made hereinabove. Order pronounced in the Open Court on 22nd November, 2024. Sd/- Sd/- (VIJAY PAL RAO) VICE PRESIDENT (MANJUNATHA G.) ACCOUNTANT MEMBER Hyderabad, dated 22.11.2024. TYNM/sps 4 SA 32/Hyd/2024 Copy to: S.No Addresses 1 Warangal Urban Co-operative Bank Limited, Hyderabad, C/o. P. Murali & Co., Chartered Accountant, 6-3-655/2/3, Somajiguda – 500082, Hyderabad, Telangana. 2 The Assistant Commissioner of Income Tax, Circle – 1, Hyderabad. 3 Pr.CIT, Hyderabad. 4 DR, ITAT Hyderabad Benches 5 Guard File By Order "