Income Tax Appellate Tribunal - Pune
Shree Ghadgenath Gramin Bigar Sheti ... vs Principal Commissioner Of Income-Tax ... on 23 May, 2023
IN THE INCOME TAX APPELLATE TRIBUNAL
PUNE BENCH "A", PUNE
BEFORE SHRI S. S. GODARA, JUDICIAL MEMBER
AND
SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER
Sl. ITA No. Name of Appellant Name of Respondent Asst.
No. Year
1 186/PUN/2023 Ajinkaya Madhyamik PCIT-3, Pune. 2018-19
Shikahak Sevak Sah.
Patsanstha Marayadit,
769, Jagtap Colony,
Malhar Peth,
Satara- 415001.
PAN : AAAAA3002D
2 213/PUN/2023 Matoshri Nagari Sahakari PCIT-4, Pune. 2017-18
Pat. Sanstha Maryadit,
Flat No.2, 797 Sadashiv
Peth, Pate Classic,
Barrister Gadgil Street,
Pune- 411030.
PAN : AAAAM9379D
3 226/PUN./2023 Jankalyan Nagari PCIT-3, Pune. 2018-19
Sahakari Patsanstha Ltd.,
67, Guruwar Peth, At
Post Tal Karad Dist.
Satara- 415110
PAN : AAAAJ1374R
4 248/PUN/2023 Kalbhairavnath Gramin PCIT-4, Pune. 2017-18
Bigarsheti Sahakari Pat
Sanstha Maryadit,
At PO Yewat Taluka
Dound, Dist. Pune-
412214
PAN : AAAAK0302J
5 257/PUN/2023 Abhinav Chetana Nagari PCIT-4, Pune. 2018-19
Sahakari Pathasanstha,
Datta Mandir, Loni
Kalbhor, Pune- 412201.
PAN : AABTA3082B
2
6 258/PUN/2023 Dhanwantari Nagari PCIT-3, Pune 2018-19
Sahakari Patsansath,
93, Dhawantari Bhavan,
Shaniwar Peth,
Satara-415002
PAN : AAAAD2344M
7 299/PUN/2023 Mahadevnagar Nagari PCIT-4, Pune. 2018-19
Sahakari Patsanstha
Maryadit Mahadevnagar,
Mahadevnagar Manjari
Road, Tal - Haveli
Dist - Pune - 412307
PAN : AAAAM9078M
8 322/PUN/2023 Janseva GB Co-Op Pat PCIT-1, Pune. 2018-19
Sanstha Ltd.,
Bazar Peth, Main Road,
Belapur Town,
Tal. Shrirampur,
Dist. Ahmednagar-
413715
PAN : AAAAJ2647P
9 323/PUN/2023 Dr Dada Gujar Nagri PCIT-4, Pune 2018-19
Sahakari Patsanstha Ltd.,
01/02 Amar Palace, Pune
Solapur Highway
Hadapsar Pune - 411028
PAN : AAAAD0295P
10 324/PUN/2023 The Karad Merchant PCIT-3, Pune. 2018-19
Sahkari Credit Sanstha
Limited,
7/8 Somwar Peth, Karad
Dist. Satara- 415110
PAN : AAAAT0955A
11 326/PUN/2023 Jankalyan Multi State PCIT-4, Pune. 2018-19
Cooperative Credit
Society Ltd.,
940 Jagjivandas
Complex, Near Garud
Bangla Road,
Solapur - 413003
PAN : AABAJ3074H
3
12 334/PUN/2023 Shri Arunoday Multi PCIT-4, Pune. 2018-19.
State Co-Operative Credit
Society Ltd.,
Arunoday, 22 Veershaiv
Nagar, Vijapur Road, Jule
Solapur- 413001
PAN : AAKAS8478H
13 340/PUN/2023 Hundustan Antibiotics PCIT-3, Pune. 2018-19
Employees Co- Operative
Credit Society Ltd.,
1 HA Colony, Pimpri,
Pune - 411018
PAN : AAAAH0357E
14 346/PUN/2023 Kalibhairavnath Gramin PCIT-4, Pune. 2018-19
Bigarsheti Sahakari Pat
Sanstha Maryadit,
At PO Yewat
Taluka Dound,
Dist. Pune- 412214
PAN : AAAAK0302J
15 353/PUN/2023 Ambegaon Taluka PCIT-3, Pune. 2018-19
Prathamik Shiksahak
Sahakari Patsanstha
Maryadit,
At Post Manchar Tal.
Ambegaon, Pune Nashik
Road, Manchar,
Pune- 410503
PAN : AAAAA2166N
16 358/PUN/2023 B.G. Shirke Employees PCIT-4, Pune. 2018-19
Cooperative Credit
Society Limited,
72-76 Industrial Estate,
Mundhawa Road,
Pune - 411036
PAN : AAAAB4805H
17 388/PUN/2023 ISSK Employees Credit PCIT-4, Pune. 2018-19
Co-Operative Society
Ltd.,
Mahatma Phule Nagar,
Bijwadi, Tal. Indapur,
Dist.Pune- 413106.
PAN : AAAAI0101K
4
18 426/PUN/2023 Daund Talluka Prathamik PCIT-4, Pune. 2018-19
Shikshak Sahakari
Phatsanstha Maryadit,
Daund Talika Shikshak
Bhavan, Near Daund,
Nagar Road, Daund,
Pune - 412220
PAN AAAAD3461F
19 450/PUN/2023 Jijamata Mahila Nagari PCIT-4, Pune. 2018-19
Bigarsheti Sahakari
Patsanstha Maryadit,
Shiv Premi Chowk, Main
Road, Mangal Wedha,
Dist. Solapur - 413305
PAN : AAAAJ3379E
20 460/PUN/2023 Kirkee Cantonment PCIT-2, Pune. 2018-19
Board Employees Credit
Cooperative Society Ltd.,
17, Field Marshal
Kariappa Road, Khadaki,
Pune- 411003
PAN : AAAAK4998C
21 475/PUN/2023 Shree Choudeshwari PCIT-4, Pune. 2018-19
Togatveer Kshatriya
Nagari Sahakari Patpedhi
Maryadit,
94/41 Jodbhavi Peth,
Kanna Chowk,
Solapur - 413002
PAN : AAAJS1987L
22 477/PUN/2023 Ichalkaranji Vyapari ITO, Ward-1, 2018-19
Sahakari Patsanstha Ltd., Ichalkaranji.
C/o. Sanjay Vhanbatte &
Co. Chartered
Accountants, CTS
No.245, C/1, 1st Floor,
Mahalaxmi Bank Bldg.,
Near Kelavkar Hospital,
Tarabai Park,
Kolhapur- 416003
PAN : AAAAI0209E
5
23 491/PUN/2023 Jay Bajarang Gram PCIT-3, Pune. 2018-19
Bigarsheti Sah Patsanstha
Maryadit,
Milkat No. OTUR,
OTUR Tal. Junnar,
Pune- 412409
PAN : AAAAJ4886A
24 496/PUN/2023 Shree Kedareshwar PCIT-4, Pune. 2018-19
Nagari Sahakari
Patsanstha Maryadit,
Shop No.4, House
No.1376, Near Somaji
Bus Stop, Kondhawa BK,
Pune- 411048
PAN : AACAS7903B
25 502/PUN/2023 Kamal Mahila Nagari PCIT-1, Thane 2018-19
S.P.M.,
Ground Floor,
Shreekrishna Niwas,
Tilak Road, Panvel,
Raigad - 410206
PAN : AAATK8008L
26 503/PUN/2023 Kamal Nagari Sahakari PCIT-1, Thane. 2018-19
Patsanstha Ltd.,
Kamal Bhawan, Shivaji
Road, Alibag,
Raigad- 402201
PAN : AAAJK0269P
27 504/PUN/2023 Keshavsmruti Nagari PCIT-1, Thane. 2017-18
Sahakari Patpedhi Ltd.,
102/103, Aaditya Vihar
CHS, Mahatma Phule
Road, Panvel- 410206
PAN : AAAAK7390L
28 771/PUN/2022 Shree Ghadgenath PCIT-3, Pune. 2017-18
Gramin Bigar Sheti
Sahakari Patsanstha
Maryadit,
A/P Kole, Karad- 415110
PAN : AAFAS9168R
6
29 889/PUN/2022 Kadepathar Gramin Bigar PCIT-4, Pune. 2017-18
Sheti Sahakari Path
Sanstha Maryadit,
At Post Jejuri Tal
Purandar,
Dist. Pune-412303
PAN : AAAAK4043Q
Assessee by : Shri Prateek Jha (Sl. No.1)
Shri Manoj R. Jain (Sl. No.2)
Shri Bhuvnesh Kankani (Sl. No.3)
Smt. Deepa Khare (Sl. No.4, 9, 10 & 14)
Shri B. B. Mane (Sl. No.5)
Mrs. Shuhada A. Koppa (Sl. No.6)
Shri Pramod S. Shingte (Sl. No.7, 13, 15, 18,
21, 22 & 23)
Shri Prasad S. Bhandari (Sl. No.8)
None (Sl. No.11, 16 & 17)
Shri Girish Ladda (Sl. No.12 & 19)
Shri Nikhil S. Pathak & Shri Ajinkya M.
Vaishampayan (Sl. No.20, 25, 26 & 27 )
Shri Abhay Avchat (Sl. No.24)
Shri M. K. Kulkarni & Mrs. J.R. Chandekar
(Sl. No.28)
Shri Manoj R. Jain (Sl. No.29)
Revenue by : Shri J. P. Chandraker (Sl. No.1 to 21, 23, 24,
25, 26, 27, 28 & 29)
Shri Ramnath P. Murkunde (Sl. No.22)
Date of hearing : 22.05.2023
Date of : 23.05.2023
pronouncement
आदेश / ORDER
PER BENCH :
These bunch of twenty nine (29) appeals preferred by the different assessees for the various assessment years mentioned in the caption emanates from the orders of the Learned Pr.7
Commissioner of Income Tax passed u/s 263 of the Income Tax Act, 1961 ('the Act').
2. Since the identical facts and common issues are involved in all the above twenty eight appeals of the different assessees, we proceed to dispose of the same by this common order.
3. For the sake of convenience and clarity, the facts relevant to the appeal of the assessee in ITA No.186/PUN/2023 for the assessment year 2018-19 are stated herein.
ITA No.186/PUN/2023, A.Y. 2018-19 :
4. Briefly, the facts of the case are that the appellant is a Co- operative Society engaged in the business of providing credit facilities to its members. The Return of Income for the assessment year 2018-19 was filed on 25.10.2018 declaring total income of Rs.Nil. In the return of income, the assessee co-operative society had sought the exemption of income earned on deposits made with other co-operative banks or other banks made out of the surplus funds from tax u/s 80P(2)(a)(i)/80P(2)(d) of the Income Tax Act, 1961 ('the Act'). The said claim came to be allowed by the Assessing Officer while completing the assessment u/s 143(3) of the Act.
8
5. Subsequently, on review of the assessment records, the ld. PCIT was of the opinion that the interest income earned by the assessee co-operative society from the deposit made with other co- operative banks or other banks does not qualify for exemption u/s 80P(2)(a)(i) of the Act. In the opinion of the ld. PCIT, the said interest income was earned from the third party or non-members, which does not qualify for exemption u/s 80P(2)(a)(i) of the Act. Thus, the ld. PCIT formed an opinion that the assessment order passed by the Assessing Officer is erroneous and prejudicial to the interests of the Revenue. Therefore, ld. PCIT set-aside the assessment order with a direction to examine the issue de novo in the light of the judicial precedents referred to by him in his order u/s 263 of the Act.
6. Being aggrieved, the appellant is in appeal before us in the present appeal.
7. We heard the rival submissions and perused the material on record. The issue in the present appeal relates to the validity of assumption of jurisdiction u/s 263 by the ld. PCIT. The Parliament had conferred the power of revision on the Commissioner of Income Tax u/s 263 of the Act in case the assessment order passed is erroneous and prejudicial to the interests of revenue. In order to 9 invoke the power of revision, the above two conditions are required to be satisfied cumulatively. References in this regard can be made to the decision of the Hon'ble Supreme Court in the case of Malabar Industrial Co. Ltd. vs. CIT, 243 ITR 83 (SC) and in the case of CIT vs. Max India Ltd., 295 ITR 282 (SC). The error in the assessment order should be one that it is not debatable or plausible view. In a case where the Assessing Officer examined the claim took one of the plausible views, the assessment order cannot be termed as an "erroneous".
8. Now, we proceed to examine the existence of fact of debate on the issue of exemption of interest income earned by the assessee co- operative society from other co-operative banks or other banks. There is a cleavage of judicial opinion among several High Courts on the issue of eligibility of this kind of income for exemption u/s. 80P(2)(a)(i) of the Act. The Hon'ble Punjab & Haryana High Court in the case of CIT vs. Punjab State Cooperative Federation of Housing Building Societies Ltd. 11 taxmann.com 448, the Hon'ble Gujarat High Court in the case of State Bank of India Vs. CIT 389 ITR 578 (Guj.), the Hon'ble Delhi High Court in the case of Mantola Co-operative Thrift & Credit Society Ltd. Vs. CIT 50 taxmann.com 278, the Hon'ble Punjab & Haryana High Court in the 10 case of CIT Vs. Punjab State Cooperative Agricultural Development Bank Ltd. 389 ITR 68 and the Hon'ble Kolkata High Court in the case of CIT Vs. Southern Eastern Employees Cooperative Credit Society Ltd. 390 ITR 524 took a view that the income arising on the surplus invested in short term deposits and securities cannot be attributed to the activities of the society and, therefore, not eligible for exemption u/s.80P(2)(a)(i) of the Act. However, the Hon'ble Karnataka High Court in the case of Tumkur Merchants Souharda Credit Cooperative Ltd. Vs. ITO (2015) 230 taxmann 309 (Kar.) and the Hon'ble Telangana and Hon'ble Andhra Pradesh High Court in the case of Vaveru Co-operative Rural Bank Ltd. v CIT [(2017) 396 ITR 371 took a view that such interest income is attributable to the activities of the society and, therefore, eligible for exemption u/s 80P(2)(a)(i) of the Act. Similar view has been taken by the Hon'ble Calcutta High Court in the case of PCIT vs. Gunja Samabay Krishi Unnayan Samity Ltd., 147 taxmann.com 518 (Calcutta) and the Hon'ble Madras High Court in the case of Chennai Central Co-operative Bank Ltd. vs. ITO, 148 taxmann.com 17 (Madras). The Coordinate Bench of Pune Benches in the case of M/s. Ratnatray Gramin Bigar Sheti Sah. Pat Sanstha Maryadit Vs. ITO (ITA Nos.559/560/PUN/2018, dated 11-12-2018) taken view in 11 favour of the assessee following the judgment of Hon'ble Karnataka High Court in the case of Tumkur Merchants Souharda Credit Cooperative Ltd. (supra). Respectfully following the decision of the Coordinate Bench of the Tribunal, I am of the considered opinion that the interest income earned on fixed deposits with bank partake of the business income which is eligible for deduction u/s 80P(2)(a)(i) of the Act.
9. The above discussion clearly brings out the fact of existence of debate on the issue of taxability of the interest income earned on the deposits made with other co-operative banks or other banks. Therefore, in the light of the law settled by the Hon'ble Supreme Court in the case of Malabar Industrial Co. Ltd. vs. CIT, 243 ITR 83, the power of revision cannot be exercised by the ld. PCIT in exercising of power vested with him u/s 263 in respect of debatable issue.
10. Even assuming for a moment, there is failure on the part of the Assessing Officer to examine the issue of taxability of interest earned on deposits made with co-operative banks or other banks, in our considered opinion, the power of revision cannot be exercised by ld. PCIT in view of the fact that even on remand to the Assessing Officer, the Assessing Officer is barred from taking a view against 12 the assessee in view of the consistent view taken by this Tribunal that such interest income qualifies for deduction u/s 80P(2)(a)(i) of the Act. Thus, the act of revision by the ld. PCIT would be futile exercise and mere a useless formality. Therefore, we are of the considered opinion that the ld. PCIT was not justified in exercising the power of revision vested with him u/s 263 of the Act in the facts of the present case. Accordingly, the appeal filed by the assessee stands allowed.
11. In the result, the appeal filed by the assessee in ITA No.186/PUN/2023 for A.Y. 2018-19 stands allowed. ITA No.213, 226, 248, 257, 258, 299, 322, 323, 324, 326, 334, 340, 346, 353, 358, 388, 426, 450, 460, 475, 477, 491, 496, 502, 503, 504/PUN/2023 and ITA Nos.771 & 889/PUN/2022, A.Ys. 2017-18 and 2018-19 :
12. Since the facts and issues involved in remaining 28 appeals of the different assessees are identical, therefore, our decision in ITA No.186/PUN/2023 for A.Y. 2018-19 shall apply mutatis mutandis to the remaining 28 appeals of the different assessees in ITA No.213, 226, 248, 257, 258, 299, 322, 323, 324, 326, 334, 340, 346, 353, 358, 388, 426, 450, 460, 475, 477, 491, 496, 502, 503, 504/PUN/2023 and ITA Nos.771 & 889/PUN/2022 for A.Ys. 2017-18 and 2018-19 respectively. Accordingly, the remaining 28 13 appeals of the different assessees in ITA No.213, 226, 248, 257, 258, 299, 322, 323, 324, 326, 334, 340, 346, 353, 358, 388, 426, 450, 460, 475, 477, 491, 496, 502, 503, 504/PUN/2023 and ITA Nos.771 & 889/PUN/2022 for A.Ys. 2017-18 and 2018-19 stands allowed.
13. To sum up, all the above captioned twenty nine appeals filed by the different assessees stands allowed.
Order pronounced on this 23rd day of May, 2023.
Sd/- Sd/-
(S. S. GODARA) (INTURI RAMA RAO)
JUDICIAL MEMBER ACCOUNTANT MEMBER
पुणे / Pune; दनांक / Dated : 23rd May, 2023.
VBP & Sujeet
आदेश क ितिलिप अ ेिषत / Copy of the Order forwarded to :
1. अपीलाथ / The Appellant.
2. यथ / The Respondent.
3. The Pr. CIT- 1/2/3/4, Pune/Thane.
4. िवभागीय ितिनिध, आयकर अपीलीय अिधकरण, "A" बच, पुणे / DR, ITAT, "A" Bench, Pune.
5. गाड फ़ाइल / Guard File.
आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune.