Income Tax Appellate Tribunal - Ahmedabad
Karmachari Co.Op.So.Ltd.,, Baroda vs The Addl.Cit.,Range-5,, Ahmedabad on 14 September, 2017
IN THE INCOME TAX APPELLATE TRIBUNAL
AHMEDABAD "A" BENCH AHMEDABAD
BEFORE, SHRI S. S. GODARA, JUDICIAL MEMBER
AND SHRI AMARIJIT SINGH, ACCOUNTANT MEMBER
ITA No. 513/Ahd/2013
(Assessment Year: 2008-09)
The Karmachari Cooperative Credit Society Ltd.,
Ground Floor, Gajanand Complex, Nr. Jagdish
Farsan House, Ramji Mandir Pole, Opp. Govt.
Press Kothi, Baroda - 390001 Appellant
Vs.
Asst. Commissioner of Income Tax,
Circle - 5, Baroda Respondent
PAN: AAAJK1038L
आवेदक क ओर से/By Assessee : Shri M. J. Shah, A.R.
राज व क ओर से/By Revenue : Shri Prasoon Kabra, Sr. D.R.
सन
ु वाई क तार ख/Date of Hearing : 08.09.2017
घोषणा क तार ख/Date of
Pronouncement : 14.09.2017
ORDER
PER S. S. GODARA, JUDICIAL MEMBER
This assessee's appeal for assessment year 2008-09 arises against the CIT(A)-V, Baroda's order dated 03.12.2012, in case no. CAB/(A) V-181/10- 11, upholding Assessing Officer's action disallowing Section 80P deduction ITA No. 513/Ahd/13 [The Karmachari Co-o. Credit Soc. Ltd. vs. ACIT] A.Y. 2008-09 -2- in respect of interest income of Rs.6,50,000/- on fixed deposits parked in the State Bank of India, in proceedings u/s. 143(3) of the Income Tax Act, 1961; in short "the Act".
Heard both sides. Case file perused.
2. Relevant facts are in a very narrow compass. This assessee is a co- operative credit society. It raised its impugned claim of deduction amounting to Rs.6,50,000/- qua interest income derived from surplus funds parked in SBI's fixed deposits scheme. The Assessing Officer disallowed the same in assessment order dated 01.12.2010 after concluding that the above interest income would not amount to an income eligible under the deduction provision in question. He was of the view that the said income came under the head 'income from other sources' u/s.56 r.w.s. 57 of the Act. The CIT(A) confirms the same in his lower appellate order under challenge.
3. We have given our thoughtful consideration to rival submissions. The dispute in question as to whether a co-operative societies' interest income derived from surplus fund parked in a nationalized banks' fixed deposit scheme is entitled for the impugned deduction or not is no more res integra in view of hon'ble jurisdictional high court's decision in State Bank of India vs. CIT (2016) 389 ITR 578 (Guj.). Their lordships hold that such an income is neither business income nor derived from investment made in another co- operative society. We therefore uphold CIT(A)'s action affirming the impugned disallowance in principle. Mr. Shah contends that Special Leave Petition preferred against hon'ble jurisdictional high court's decision stands admitted in hon'ble apex court. We are therefore urged to remit the instant issue back to the Assessing Officer to await final outcome thereof. We find no reason to accept the instant plea since it is not the assessee whose lis on the very issue can be held to be pending before the hon'ble Supreme Court.
ITA No. 513/Ahd/13 [The Karmachari Co-o. Credit Soc. Ltd. vs. ACIT]A.Y. 2008-09 -3- There is no other material pointed out indicating any distinction on facts or law.
4. The assessee at this stage raises an alternative plea that the impugned disallowance deserves to be computed as per netting formula. We find that a co-ordinate bench decision in ITO vs. The Alarsa Nagrik Cooperative Bank Society Ltd. in ITA No. 2072/Ahd/2014 has already accepted such a netting plea. We therefore accept assessee's alternative plea and direct the Assessing Officer to finalize netting exercise as per law after affording adequate opportunity of hearing.
5. This assessee's appeal is partly allowed for statistical purposes.
[Pronounced in the open Court on this the 14th day of September, 2017.] Sd/- Sd/-
(AMARIJIT SINGH) (S. S. GODARA)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Ahmedabad: Dated 14/09/2017
True Copy
S.K.SINHA
आदे श क त ल
प अ े
षत / Copy of Order Forwarded to:-
1. राज व / Revenue
2. आवेदक / Assessee
3. संबं धत आयकर आयु!त / Concerned CIT
4. आयकर आयु!त- अपील / CIT (A)
5. )वभागीय ,-त-न ध, आयकर अपील य अ धकरण, अहमदाबाद / DR, ITAT, Ahmedabad
6. गाड3 फाइल / Guard file.
By order/आदे श से, उप/सहायक पंजीकार आयकर अपील य अ धकरण, अहमदाबाद ।