Income Tax Appellate Tribunal - Mumbai
Acit 1(2)(1), Mumbai vs Citizen Credit Co Operative Bank Ltd, ... on 3 May, 2019
IN THE INCOME TAX APPELLATE TRIBUNAL "C"
BENCH, MUMBAI
BEFORE HON'BLE SH. SANDEEP GOSAIN, JM &
HON'BLE SH. N. K. PRADHAN, AM
आयकरअपीलसं./ I.T.A. No. 6012/Mum/2017
(निर्धारणवर्ा / Assessment Year: 2011-12)
ACIT -1(2)(1), M/s Citizen Credit Co-
535, Aayakar Bhavan, Operative Bank Ltd.
बिधम/ Helena Apartments Mount
Mumbai-400 020
Vs. Carmel Road, Bandra
West, Mumbai-400 050
स्थायीलेखासं ./ जीआइआरसं ./ PAN No. AAAAC0016F
(अपीलाथी/Appellant) : (प्रत्यथी / Respondent)
अपीलाथीकीओरसे/ Appellant : Shri Abi Rama Karthkiyen,
by DR
प्रत्यथीकीओरसे/Respondentby : Dr. K. Shivram & Shri
Sashank Dundu, ARs
सुनवाईकीतारीख/
: 19.02.2019
Date of Hearing
घोषणाकीतारीख / : 03.05.2019
Date of Pronouncement
आदे श / O R D E R
Per Sandeep Gosain, Judicial Member:
The present Appeal has been filed by the revenue against the order of Commissioner of Income Tax (Appeals)-2, Mumbai, dated 03.07.17 for AY 2011-12 on the grounds mentioned herein below:-
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I.T.A. No. 6012/Mum/2017 M/s Citizen Credit Co-Operative Bank Ltd.
1. Whether on the facts and circumstances of the case, the Ld.CIT(A) has erred in allowing deduction amounting to Rs.1,42,06,000/- u/s 36(l)(viii) on account of profits derived from eligible business carried out by a 'specified entity' and carried to a special reserve, without verifying whether the assessee company is a 'specified entity' as per Explanation (d) to Section 36(l)(viii) read with Explanation to Section 80P(4) and Part V of the Banking Regulation Act, 1949?
2. Whether on the facts and circumstances of the case, the Ld.CIT(A) has erred in allowing deduction amounting to Rs.1,42,06,000/- u/s 36(l)(viii) on account of profits derived from 'eligible business' carried out by a specified entity and carried to a special reserve, without verifying whether the profits were derived from 'eligible businesses', viz. providing long-term finance for (a) industrial or agricultural development, (b) development of infrastructure facility in India, or (c) development of housing in India?
The appellant craves leave to add to, amend or withdraw the aforesaid ground of appeal.
2. As per the facts of the present case, the return of income was filed by the assessee on 28.09.11 declaring total income at 3 I.T.A. No. 6012/Mum/2017 M/s Citizen Credit Co-Operative Bank Ltd.
Rs. 24,91,05,830/-. Subsequently, the case was selected for scrutiny and after serving statutory notice and seeking reply of the assessee, assessment order u/s. 143(3)dated 21.11.2013 was passed by the AO, thereby an amount of Rs. 2,20,99,000/- was added to the total income of the assessee.
3. Aggrieved by the order of AO, assessee preferred appeal before Ld. CIT(A) and Ld. CIT(A) after considering the case of both the parties allowed the appeal of the assessee.
4. Aggrieved by the order of Ld. CIT(A), revenue has filed the present appeal before us on the grounds mentioned herein above.
Ground No. 1 & 2
5. These grounds raised by the revenue are inter connected and inter related and relates to challenging the order of Ld. CIT(A) in allowing deduction amounting to Rs.1,42,06,000/- u/s 36(1)(viii) on account of profits derived from eligible business carried out by a 'specified entity' and carried to a special reserve, 4 I.T.A. No. 6012/Mum/2017 M/s Citizen Credit Co-Operative Bank Ltd.
therefore we thought it fit to dispose of the same by this common order.
6. We have heard the counsels for both the parties at length and we have also perused the material placed on record as well as the orders passed by revenue authorities.
Before we decide the merits of the case, it is necessary to evaluate the orders passed by Ld. CIT(A). The Ld. CIT(A) has dealt with the above grounds raised by the revenue in para no. 3 of its order and the same is reproduced below:-
3 In the light of the above direction given by the Hon'ble ITAT C Bench, I am of the opinion that deduction claimed by the appellant company u/s 36(1)(viii) of Rs. 1,42,06,000/- is to be allowed by the AO. Accordingly, this appeal is allowed.
7. After having gone through the facts of the present case and hearing the parties at length, we find that initially AO and Ld. CIT(A) in the first round of litigation had disallowed the claim of the assessee on the premise that no revised return was filed by the assessee. Whereas assessee had explained by submitting 5 I.T.A. No. 6012/Mum/2017 M/s Citizen Credit Co-Operative Bank Ltd.
detailed computation of special reserve deduction, which was audited by statutory auditors of the bank and thus submitted that assessee was eligible for the deduction u/s 36(1)(viii) of the Act. It was argued that similar claim was also accepted by CPC in subsequent years and thus the Tribunal while considering the said facts, had restored the matter back to the file of First Appellate Authority for fresh adjudication. It is true that Ld. CIT(A) had not passed well reasoned speaking order, but the fact remains that the assessee had submitted detailed explanation alongwith computation of special reserve alonwith the statutory auditor's report. Even similar claim has already been accepted by CPC, thus considering the above facts, we feel there are no reasons to stretch the claim of the assessee any further.
8. Even otherewise, Hon'ble supreme Court in the case of Bharat Samachar Nigam Ltd. Vrs. UOI (2006) 282 ITR 273 (SC) had held that the rule of consistency may be followed, wherein it was said "Each assessment year being a unit, what is decided in one year may not apply in the following year but where a fundamental aspect permeating through the different 6 I.T.A. No. 6012/Mum/2017 M/s Citizen Credit Co-Operative Bank Ltd.
assessment years has been found as a fact one way or the other and parties have allowed that position to be sustained by not challenging the order, it would not be at all appropriate to allow the position to be changed in a subsequent year."
9. We also noticed that in the subsequent years, order u/s 143(3) of the Act had already been passed in favour of the assessee, which also support the stand taken by the assesse and therefore, Ld. CIT(A) while appreciating the facts of the present case had rightly allowed the appeal of the assessee.
10. Moreover, no new facts or contrary judgments have been brought on record before us in order to controvert or rebut the findings so recorded by Ld CIT (A). Therefore, there are no reasons for us to interfere into or deviate from the findings recorded by the Ld. CIT (A). Hence, we are of the considered view that the findings so recorded by the Ld. CIT (A) are judicious and are well reasoned. Resultantly, these grounds raised by the revenue stands dismissed.
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I.T.A. No. 6012/Mum/2017 M/s Citizen Credit Co-Operative Bank Ltd.
11. In the net result, the appeal filed by the revenue stands dismissed with no order as to cost.
Order pronounced in the open court on 3rd May 2019.
Sd/- Sd/-
(N. K. Pradhan) (Sandeep Gosain)
ले खासदस्य / Accountant Member न्याययकसदस्य / Judicial Member
मुंबई Mumbai;यदनां कDated : 03.05.2019
Sr.PS. Dhananjay
आदे शकीप्रनिनिनिअग्रे नर्ि/Copy of the Order forwarded to :
1. अपीलाथी/ The Appellant
2. प्रत्यथी/ The Respondent
3. आयकरआयुक्त(अपील) / The CIT(A)
4. आयकरआयुक्त/ CIT- concerned
5. यवभागीयप्रयतयनयध, आयकरअपीलीयअयधकरण, मुंबई/ DR, ITAT, Mumbai
6. गार्ड फाईल / Guard File आदे शधिुसधर/ BY ORDER, उि/सहधयकिंजीकधर (Dy./Asstt.Registrar) .
आयकरअिीिीयअनर्करण, मुंबई/ ITAT, Mumbai