Income Tax Appellate Tribunal - Chennai
Acit Circle 1, Ooty vs Nilgiri District Central Co-Operative ... on 29 October, 2018
आयकर अपील य अ
धकरण, 'ए' यायपीठ, चे नई
IN THE INCOME TAX APPELLATE TRIBUNAL, 'A' BENCH : CHENNAI
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[BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER
AND SHRI DUVVURU RL REDDY, JUDICIAL MEMBER]
आयकर अपील सं./I.T.A. No.1851/CHNY/2018.
नधा रण वष /Assessment year : 2014-2015.
The Assistant Commissioner Vs. M/s. Nilgiri District Central Co-
of Income Tax, operative Bank Ltd,
Circle 1, No.5, Charing Cross Road,
Ooty. Ootacamund -1
[PAN AAALT 0073E]
(अपीलाथ-/Appellant) (./यथ-/Respondent)
अपीलाथ क ओर से/ Appellant by : Shri. M.Srinivasa Rao, IRS, CIT.
यथ क ओर से /Respondent by : Shri. R. Rajan, FCA
सन
ु वाई क तार ख/Date of Hearing : 24-10-2018
घोषणा क तार ख /Date of Pronouncement : 29-10-2018
आदे श / O R D E R
PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER
In this appeal filed by the Revenue, it is aggrieved that ld. Commissioner of Income Tax (Appeals) deleted disallowance of interest of >29,44,42,416/- made by the ld. Assessing Officer.
2. Ld. Counsel for the Revenue submitted that assessee though it was a co-operative bank, could not show that the interest of :- 2 -: ITA No.1851 /2018 >29,44,42,416/- was paid to its members. As per the ld. Departmental Representative, assessee was obliged to deduct tax at source u/s.194A of the Income Tax Act, 1961 (in short ''the Act'') where interest was paid on deposits accepted from non-members. Contention of the ld. Departmental Representative was that assessee was required to produce evidence to prove the interest payments to have been made only to its members. As per the ld. Departmental Representative, during the course of assessment proceedings, assessee had refused to do so, stating that number of accounts ran into thousands and it would not be possible for them to submit such details.
As per the ld. Departmental Representative, despite this reluctance to prove the interest payment to have been made to its members, ld. Commissioner of Income Tax (Appeals) had allowed the claim relying on a judgment of Hon'ble Jurisdictional High Court in the case of Coimbatore District Central Co-operative Bank Ltd. vs. ITO, (2016) 382 ITR 266.
3. Per contra, ld. Authorised Representative submitted that details of the interest payments were furnished by the assessee before the ld. Commissioner of Income Tax (Appeals). According to him, ld. Commissioner of Income Tax (Appeals) had allowed the claim after verifying such details. Nevertheless, ld. Authorised :- 3 -: ITA No.1851 /2018 Representative submitted that assessee was willing to provide the details to the ld. Assessing Officer, if required. Ld. Authorised Representative also filed an undertaking dated even on behalf of the assessee, agreeing to this.
4. We have considered the rival contentions and perused the orders of the authorities below. By virtue of the judgment of Hon'ble Jurisdictional High Court in the case of Coimbatore District Central Co- operative Bank Ltd (supra), there can be no doubt that a Co-operative Society carrying on business of banking the approval of Reserve Bank of India is not liable to deduct tax at source as stipulated u/s.194A of the Act, on interest paid to its members. Ld. Assessing Officer had disallowed the claim due to the failure of the assessee to show that the interest payment of >29,44,42,416/- debited by it, in its profit and loss account was to its members. Ld. Commissioner of Income Tax (Appeals) however, overlooked this aspect and allowed the claim. Considering the facts and circumstances, we are of the opinion that assessee can be given one more opportunity for proving that interest payments were made to its members. We also take note of the undertaking given by the ld. Authorised Representative in this regard. We therefore set aside the orders of the lower authorities and remit the issue relating to interest payments of >29,44,42,416/- made by the :- 4 -: ITA No.1851 /2018 assessee, back to the file of the ld. Assessing Officer for consideration afresh in accordance with law.
5. In the result, the appeal of the Revenue is allowed for statistical purpose.
Order pronounced on Monday, the 29th day of October, 2018, at Chennai.
Sd/- Sd/-
(ध#ु व$
ु आर.एल रे %डी) (अ ाहम पी. जॉज )
(DUVVURU RL REDDY) (ABRAHAM P. GEORGE)
या(यक सद य/JUDICIAL MEMBER लेखा सद य /ACCOUNTANT MEMBER
चे#नई/Chennai
$दनांक/Dated:29th October, 2018.
KV
आदे श क त'ल(प अ)े(षत/Copy to:
1. अपीलाथ /Appellant 3. आयकर आय*
ु त (अपील )/CIT(A) 5. (वभागीय त न/ध/DR
2. यथ /Respondent 4. आयकर आयु*त/CIT 6. गाड फाईल/GF