Jila Sahakari Kendriya Bank Maryadit Seoni vs. The Principal Commissioner Of

IN THE HIGH COURT OF MADHYA PRADESH AT JABALPUR BEFORE HON'BLE SHRI JUSTICE SHEEL NAGU & HON’BLE SHRI JUSTICE HIRDESH INCOME TAX APPEAL No. 196 of 2022 BETWEEN:- JILA SAHAKARI KENDRIYA BANK MARYADIT, SCHOOL, SEONI THROUGH CHIEF EXECUTIVE OFFICER, “SAHAKARI BHAWAN”, G.N. ROAD, NEAR BUS STAND, SEONI, DISTRICT- SEONI (M.P.) .....APPELLANT (BY SHRI BHASKAR GANGULY, ADVOCATE) AND 1. THE PRINCIPAL COMMISSIONER OF INCOME TAX, JABALPUR, “AAYKAR BHAVAN”, AAYKAR SQUARE, NAPIER TOWN, JABALPUR (M.P.) 2. THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 2(1), JABALPUR, “AAYKAR BHAVAN”, AAYKAR SQUARE, NAPIER TOWN, JABALPUR (M.P.) 3. THE INCOME TAX OFFICER, WARD SEONI, FIRST FLOOR, WAINGANGA HEIGHT, OPPOSITE VATIKA RESTAURANT, BARA PATHAR, DISTRICT- SEONI (M.P.) - 2 - .....RESPONDENTS (BY SHRI SIDDHARTH SHARMA, ADVOCATE ) AND INCOME TAX APPEAL No. 201 of 2022 BETWEEN:- JILA SAHAKARI KENDRIYA BANK MARYADIT, SCHOOL, SEONI THROUGH CHIEF EXECUTIVE OFFICER, “SAHAKARI BHAWAN”, G.N. ROAD, NEAR BUS STAND, SEONI, DISTRICT- SEONI (M.P.) .....APPELLANT (BY SHRI BHASKAR GANGULY, ADVOCATE) AND 1. THE PRINCIPAL COMMISSIONER OF INCOME TAX, JABALPUR, “AAYKAR BHAVAN”, AAYKAR SQUARE, NAPIER TOWN, JABALPUR (M.P.) 2. THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 2(1), JABALPUR, “AAYKAR BHAVAN”, AAYKAR SQUARE, NAPIER TOWN, JABALPUR (M.P.) 3. THE INCOME TAX OFFICER, WARD SEONI, FIRST FLOOR, WAINGANGA HEIGHT, OPPOSITE VATIKA RESTAURANT, BARA PATHAR, DISTRICT- SEONI (M.P.) - 3 - .....RESPONDENTS (BY SHRI SIDDHARTH SHARMA, ADVOCATE ) AND INCOME TAX APPEAL No. 202 of 2022 BETWEEN:- JILA SAHAKARI KENDRIYA BANK MARYADIT, SCHOOL, SEONI THROUGH CHIEF EXECUTIVE OFFICER, “SAHAKARI BHAWAN”, G.N. ROAD, NEAR BUS STAND, SEONI, DISTRICT- SEONI (M.P.) .....APPELLANT (BY SHRI BHASKAR GANGULY, ADVOCATE) AND 1. THE PRINCIPAL COMMISSIONER OF INCOME TAX, JABALPUR, “AAYKAR BHAVAN”, AAYKAR SQUARE, NAPIER TOWN, JABALPUR (M.P.) 2. THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 2(1), JABALPUR, “AAYKAR BHAVAN”, AAYKAR SQUARE, NAPIER TOWN, JABALPUR (M.P.) 3. THE INCOME TAX OFFICER, WARD SEONI, FIRST FLOOR, WAINGANGA HEIGHT, OPPOSITE VATIKA RESTAURANT, BARA PATHAR, DISTRICT- SEONI (M.P.) .....RESPONDENTS (BY SHRI SIDDHARTH SHARMA, ADVOCATE ) - 4 - AND INCOME TAX APPEAL No. 203 of 2022 BETWEEN:- JILA SAHAKARI KENDRIYA BANK MARYADIT, SCHOOL, SEONI THROUGH CHIEF EXECUTIVE OFFICER, “SAHAKARI BHAWAN”, G.N. ROAD, NEAR BUS STAND, SEONI, DISTRICT- SEONI (M.P.) .....APPELLANT (BY SHRI BHASKAR GANGULY, ADVOCATE) AND 1. THE PRINCIPAL COMMISSIONER OF INCOME TAX, JABALPUR, “AAYKAR BHAVAN”, AAYKAR SQUARE, NAPIER TOWN, JABALPUR (M.P.) 2. THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 2(1), JABALPUR, “AAYKAR BHAVAN”, AAYKAR SQUARE, NAPIER TOWN, JABALPUR (M.P.) 3. THE INCOME TAX OFFICER, WARD SEONI, FIRST FLOOR, WAINGANGA HEIGHT, OPPOSITE VATIKA RESTAURANT, BARA PATHAR, DISTRICT- SEONI (M.P.) .....RESPONDENTS (BY SHRI SIDDHARTH SHARMA, ADVOCATE ) - 5 - INCOME TAX APPEAL No. 204 of 2022 BETWEEN:- JILA SAHAKARI KENDRIYA BANK MARYADIT, SCHOOL, SEONI THROUGH CHIEF EXECUTIVE OFFICER, “SAHAKARI BHAWAN”, G.N. ROAD, NEAR BUS STAND, SEONI, DISTRICT- SEONI (M.P.) .....APPELLANT (BY SHRI BHASKAR GANGULY, ADVOCATE) AND 1. THE PRINCIPAL COMMISSIONER OF INCOME TAX, JABALPUR, “AAYKAR BHAVAN”, AAYKAR SQUARE, NAPIER TOWN, JABALPUR (M.P.) 2. THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 2(1), JABALPUR, “AAYKAR BHAVAN”, AAYKAR SQUARE, NAPIER TOWN, JABALPUR (M.P.) 3. THE INCOME TAX OFFICER, WARD SEONI, FIRST FLOOR, WAINGANGA HEIGHT, OPPOSITE VATIKA RESTAURANT, BARA PATHAR, DISTRICT- SEONI (M.P.) .....RESPONDENTS (BY SHRI SIDDHARTH SHARMA, ADVOCATE) ----------------------------------------------------------------------------------------- Reserved on : 04.05.2023 Pronounced on : 12.06.2023 ------------------------------------------------------------------------------------ - 6 - This petition having been heard and reserved for orders, coming on for pronouncement this day, the Court pronounced the following: ORDER All these appeals bearing ITA No.196/2022, ITA No.201/2022, ITA No.202/2023, ITA No.203/2022 & ITA No.204/2022 filed u/S 260A of Income Tax Act, 1961 (for brevity “Act”) assailing common final order dated 29.04.2022 (Annexure P/24) passed by Income Tax Appellate Tribunal, Jabalpur Bench, Jabalpur (for brevity “Tribunal”) in respective cases proposing common substantial question of law, are being decided by this common order. 2. Facts are picked up from ITA No.196/2022 for disposal of all these five three ITAs. 3. The proposed substantial questions of law framed by the Tribunal are as follows:- “1. Whether in the facts and circumstances of the case, the Tribunal is right in law that the ‘assumption of jurisdiction by the Assessing Officer under section 147/148 and consequent issue of notice under section 148 did not suffer from invalidity and reason to believe escapement of income was bonafide? 2. Whether in the facts and circumstances of the case, the Tribunal is right in law to set-aside the assessment and restore the matter back to the Assessing Officer for reverification of books of accounts on suspicion that excessive claim of over due interest by the appellant could not be ruled out. 3. Whether in the facts and circumstances of the case, the Tribunal is right in law to enter into verification of correctness of quantum of over due interest when there was no dispute on it and the issue did not arise out of Revenues appeal and grounds raised therein and as such exceeded its jurisdiction vested in it under section 254 of the Act? - 7 - 4. Whether on the facts and in the circumstances of the case, the Tribunal is right in law to hold that there is excess claim for over due interest, made by the appellant and it’s finding on this issue is not perverse? 5. Whether the Tribunal is right in law to hold that over due interest (interest on non performing assets) per se, is not allowable under section 36(1) (viia) of the Income Tax Act 1961? 6. Whether in the fact and circumstances of the law, the Tribunal is right in law to hold that he amendment made in section 43-D of the Act by Finance Act 2017 to insert the words “cooperative bank” as one of the entities for the benefit of this section is retrospective only from 01.05.2017 and not from 01.04.2007. 7. Whether on the facts and in the circumstances of the case, the Tribunal is right in law to hold that the appellant could not support it’s claim of deduction of over due interest, first by claiming it as non- recognized income covered by the RBI Guidelines and then alternatively under section 36(1) (viia) of the Income Tax Act 1961 as these are contradictory? 8. Whether the Tribunal is right in law to not decide the issue as to whether the overdue interest is allowable under the guidelines of the RBI which have the overriding effect on all other law including the Income Tax Act, 1961?” 4. Learned counsel for rival parties are heard on the question of admission so also on final disposal. 5. Learned counsel for appellants is heard at length. Learned counsel has emphasized that the question of law as regards retrospectivity of the amendment made to Section 23(b) of the Finance Act, 2017, the ground of deduction of overdue interest qua the ideal guidelines has not been considered by the Tribunal in its true perspective. - 8 - 5.1 Learned counsel for the appellants has relied upon several decisions of various aspects which need not be gone into in view of the nature of the order being passed infra. 6. The facts reveal that the Tribunal was seized of three set of appeals filed by the Revenue and two prosubjections by the assessee in respect of three assessment years i.e. 2009-2010, 2013-2014 and 2014- 2015. The aspect regarding retrospectivity was not of Section 43-D of the Finance Act, 2017, it seems from the record that the Tribunal has applied its mind to the ground raised by the appellants in Para 402 of the impugned order while the other ground of deduction of overdue interest qua RBI guidelines is also discussed in Para 2, 4.3 & 4.4. 7. The proposed substantial question of law contained in paragraph 52(1) in ITA No.196/2022, ITA No.201/2022 & ITA No.202/2022 are unique to the said ITAs. However, a comprehensive scrutiny of the said proposed questions of law in the said three ITAs reveal that they are generic in nature and derive strength from the proposed substantial questions of law in ITA No.196/2022, ITA No.203/2022 & ITA No.204/2022 and therefore do not need any separate consideration and thus shall suffer the same fate as the fate of the other proposed substantial questions of law in the connected ITAs (supra). 8. After hearing learned counsel for rival parties for pressing the decision in the impugned order in the findings therein, it is obvious that the Tribunal has taken care to discuss all the issues raised before it and - 9 - has rendered findings which is based primarily on facts. References may have been made of certain legal provisions but the adjudication and rendering of findings are essentially facts-centric. 9. It is settled principle of law that an appeal before this Court u/S 260-A of the Act can be entertained only and any substantial question of law as involved which does not appears to be the case herein. 10. Consequently, in the absence of any substantial question of law being made out much less the proposed one, this Court declines interference and dismisses ITA No.196/2022, ITA No.201/2022, ITA No.202/2022, ITA No.203/2022 & ITA No.204/2022 in limine. (SHEEL NAGU) (HIRDESH)

JUDGE JUDGE YS Digitally signed by YOGESH KUMAR SHIRVASTAVA Date: 2023.06.14 10:47:26 +05'30'