Income Tax Appellate Tribunal - Cochin
The Morazha Kallisserri Service Co-Op ... vs The Ito, Kannur on 17 March, 2017
IN THE INCOME TAX APPELLATE TRIBUNAL
COCHIN BENCH, COCHIN
BEFORE S/SHRI ABRAHAM P. GEORGE, AM & GEORGE GEORGE K., JM
M.P. Nos. 04-07/Coch/2017
(I.T.A. Nos.725-728/Coch/2013)
Assessment Year :
The Morazha-Kalliasseri Service Vs. The Income Tax Officer, Ward-1,
Co-op Bank Ltd., Kannur.
Anchampeedika,
Kannur-670 331.
[PAN: AAAAT 9657M]
(Assessee-Appellant) (Revenue-Respondent)
Assessee by Shri R. Krishna Iyer, CA
Revenue by Shri A. Dhanaraj, Sr. DR
Date of hearing 17/03/2017
Date of pronouncement 17/03/2017
ORDER
Per ABRAHAM P. GEORGE, ACCOUNTANT MEMBER:
Assessee through these Miscellaneous Petitions seeks recall of the order of the Tribunal dated 17/10/2014 in I.T.A. Nos.725-728/Coch/2013.
2. Ld. AR submitted that the Tribunal had decided the question of deduction u/s. 80P(2) of the Income Tax Act, 1961(in short 'the Act'), based on the earlier Bench decision in the case of Pinarayi Service Co-operative Bank Ltd., Kannur vs. 2 M.P. Nos.04-07/Coch/2017 ITO (2015) 162 ITD 90. As per Ld. AR assessee was a Primary Agricultural Credit Society registered under the Kerala Co-operative Societies Act, 1969 and by virtue of judgment of Hon'ble Jurisdictional High Court in the case of Chirakkal Service Co-operative Bank Ltd. v. CIT (384 ITR 490) eligible for deduction u/s. 80P(2) of the Act. As per Ld. AR, the said judgment of the Jurisdictional High Court was rendered subsequent to the order of the Tribunal. Relying on the judgment of the Apex Court in the case of ACIT vs. Saurashtra Kutch Stock Exchange Ltd. (305 ITR 227), Full Bench judgment of Hon'ble Punjab & Haryana High Court in CIT vs. Smt. Aruna Luthra (252 ITR 76), and that of Hon'ble Kerala High court in the case of Kil Kotagiri Tea and Copper Estates Co. Ltd. vs. ITAT & Others (174 ITR 579), Ld. AR submitted that the subsequent judgment of the Hon'ble Jurisdictional High Court in the case of Chirakkal Service Co-operative Bank Ltd. (supra) gave an exposition of law with regard to application of section 80P(2), was a good reason for rectifying the order of the Tribunal. As per Ld. AR, assessee was a Primary Agricultural Credit Society and had provided certificate to this effect before the lower authorities, but it was considered as a Co-operative Bank and denied deduction u/s. 80P(2) of the Act. It was also submitted by Ld. AR that disallowance u/s. 40(a)(ia) of the Act for non deduction of tax at source on interest paid on deposits was also confirmed by this Tribunal again relying on the very same decision of the Co-ordinate Bench in the case of Pinarayi Service Co-operative Bank Ltd. (supra). Once the assessee was found to be eligible for claim of exemption u/s. 80P of the Act, as per Ld. AR, it would 3 M.P. Nos.04-07/Coch/2017 get benefit of exemption u/s. 194A(3)(viia) of the Act and could not be saddled with a liability to deduct tax at source on interest paid.
3. Per contra, Ld. DR submitted that subsequent judgment of the Hon'ble Jurisdictional High Court would not be sufficient enough reason for seeking rectification.
4. We have heard the rival submissions and perused the orders. It has not been disputed by the Revenue that in the case of Chirakkal Service-Co-operative Bank Ltd. (supra), the Hon'ble Jurisdictional High Court held an assessee certified by a competent authority as a Primary Agricultural Credit Society under Kerala Co- operative Societies Act, 1969, to be entitled to the claim of deduction u/s. 80P(2) of the Act. Assessee here, had produced certificate from the competent authority before the lower authorities. When the Tribunal originally disposed off the appeal, the above judgment of Hon'ble Jurisdictional High Court was not available, and Tribunal had taken a view adverse to the assessee. Whether subsequent judgment of Hon'ble Jurisdictional High Court will be a sufficient reason to grant a rectification, has been elaborately dealt with by Hon'ble Apex Court in the case of ACIT vs. Saurashtra Kutch Stock Exchange Ltd., (supra). It was held that exposition of law by Jurisdictional High Court will be retroactive, or in other words, explained the law as it was from the beginning. We are of the opinion that since the subsequent judgment of Hon'ble Jurisdictional High Court 4 M.P. Nos.04-07/Coch/2017 in the case of Chirakkal Service-Co-operative Bank Ltd. (supra) had impliedly overruled the impugned order of the Tribunal, it has to be recalled. We, therefore, recall the impugned orders of the Tribunal and direct the Registry to post it for fresh hearing in due course.
In the result, the Miscellaneous Petitions of the assessee are allowed.
Pronounced in the open court on 17-03-2017.
sd/- sd/- (GEORGE GEORGE K.) (ABRAHAM P. GEORGE) JUDICIAL MEMBER ACCOUNTANT MEMBER Place: Kochi Dated: 17th March, 2017 GJ Copy to:
1. The Morazha-Kalliasseri Service Co-op Bank Ltd., Anchampeedika, Kannur-670 331.
2. The Income Tax Officer, Ward-1, Kannur.
3. The Commissioner of Income-tax(Appeals),Kozhikode.
4. The Commissioner of Income-tax, Kozhikode.
5. D.R., I.T.A.T., Cochin Bench, Cochin.
6. Guard File.
By Order (ASSISTANT REGISTRAR) I.T.A.T., Cochin