THE PR.COMMISSIONER OF INCOME TAX ROHTAK vs. THE JHAJJAR CENTRAL CO OP BANK LTD JHAJJAR

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ITA/93/2019HC Punjab & HaryanaPHHC01005216201923 January 2020Bench: MR. JUSTICE AJAY TEWARI,MR. JUSTICE AVNEESH JHINGAN2 pages
AI SummaryDismissed

What did the High Court hold?

The High Court dismissed the appeal. Regarding the first substantial question of law, the Court noted that the issue was covered by its own previous judgment in Principal Commissioner of Income Tax vs. Ludhiana Central Co-op. Bank Ltd., reported as 2019 410 ITR 72 (P&H), which was against the appellant (Revenue). Concerning the second substantial question of law, the Court observed that the tax effect involved was nominal and much less than the monetary limit prescribed by CBDT Circular No. 3 of 2018, as amended by Circular No. 17 of 2019 and Letter No. F.No.279/Misc/M-93/2018-ITJ dated 20.08.2019. Consequently, the appeal was dismissed on these grounds.

What were the facts?

The Revenue, Pr. Commissioner of Income Tax, Rohtak, filed an appeal under Section 260A of the Income Tax Act, 1961, against an order dated 30.05.2018 passed by the Income Tax Appellate Tribunal (ITAT), Delhi Bench 'B'. The appeal pertains to the assessment year 2012-13 and challenges the deletion of additions made by the Assessing Officer (AO). The additions in dispute relate to Rs. 3,31,60,915/- concerning provisions under Section 43D read with Section 36(1)(viia) of the Act, and an amount related to provisions for Chartered Accountant's audit fee. The ITAT had upheld the order of the Commissioner of Income Tax (Appeals) in deleting these additions.

What were the issues?

1. Whether the ITAT was correct in law and facts in upholding the deletion of the addition of Rs. 3,31,60,915/-, considering that the assessee bank is not a scheduled bank and therefore not entitled to the benefits of Section 43D read with Section 36(1)(viia) of the Income Tax Act, 1961. 2. Whether the ITAT was correct in law and facts in deleting the addition on account of provisions for Chartered Accountant's audit fee, where the provision was claimed in the year under consideration but the actual payment was made in a subsequent year. Assessee's contentions: Not recorded in the judgment. Revenue's contentions: The assessee bank, not being a scheduled bank, is not eligible for the benefits under Section 43D read with Section 36(1)(viia). The addition on account of CA's audit fee should be sustained as the payment was made in a subsequent year.

Which sections of the Income-tax Act were involved?

Section 260A,Section 43D,Section 36(1)(viia)

AI-generated summary — verify with the full judgment below

ITA-93-2019 (O&M) 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH 104 ITA-93-2019 (O&M) Date of Decision : 23.1.2020

The Pr. Commissioner of Income Tax, Rohtak ...... Appellant Versus The Jhajjar Central Co-op. Bank Ltd. ...... Respondent CORAM : HON'BLE MR.JUSTICE AJAY TEWARI : HON'BLE MR.JUSTICE AVNEESH JHINGAN *** Present : Mr. Sandeep Goyal, Sr.Standing counsel with Mr. Chetan Sood, Jr. Standing counsel for the appellant. *** AJAY TEWARI, J. (Oral) 1. This appeal has been filed by the Revenue under Section 260A of the Income Tax Act,1961 (for short 'the Act') against the order dated 30.5.2018 passed by the Income Tax Appellate Tribunal, Delhi Bench 'B; New Delhi in ITA No. 939/Del/2016 dated 30.5.2018 for the assessment year 2012-13, claiming the following substantial questions of law :- “i. Whether the Ld. ITAT was right in law as well as on facts in upholding the order of Ld. CIT (A) in deleting the addition of Rs. 3,31,60,915/- made by the A.O. because as per the provisions of section 43D read with explanation (ii) of sub section (viia) of sub section 36 of the I.T. Act, 1961 which are applicable to a schedule bank and name of the assessee bank is not figured in the list of schedule bank, assessee is not entitled for the benefit of the above provisions of the Income Tax Act. (ii) Whether the Ld. ITAT was right in law as well as on facts ANURADHA 2020.01.27 16:56 I attest to the accuracy and integrity of this document

ITA-93-2019 (O&M) 2 in deleting addition on account of provisions of CA's audit fee since the assessee claimed the provisions of CA's audit fee in the year under consideration but the actual payment was made in the subsequent year.” 2. Learned counsel has very fairly stated that substantial question of law No.1 is covered by the judgment of this Court passed in Principal Commissioner of Income Tax vs. Ludhiana Central Co-op. Bank Ltd. reported as 2019 410ITR 72 (P&H) against the appellant and as regards question No.2 the tax effect involved is nominal and much less than the monetary limit as prescribed in Circular No.3 of 2018 dated 11.07.2018 issued by the Central Board of Direct Taxes, further amended vide Circular No.17 of 2019 dated 08.08.2019 read with Letter No.F.No.279/Misc/M-93/2018-ITJ dated 20.08.2019. 3. Consequently, the petition is dismissed. 4. Since the main case has been dismissed, the pending application, if any, also stands disposed of.

(AJAY TEWARI)

JUDGE (AVNEESH JHINGAN) JUDGE 23.1.2020 anuradha

Whether speaking/reasoned - Yes/No Whether reportable - Yes/No ANURADHA 2020.01.27 16:56 I attest to the accuracy and integrity of this document

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