THE COMMISSIONER OF INCOME TAX vs. M/S CANARA BANK

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ITA/300/2018HC KarnatakaKAHC01037872201810 January 2023Bench: P.S.DINESH KUMAR,G BASAVARAJA4 pages
AI SummaryDismissed

What did the High Court hold?

The High Court dismissed the appeal. Regarding the first question of law, the assessee submitted that it did not arise for consideration, and this was not disputed by the Revenue. The High Court implicitly accepted this by not addressing it on merits. For the second question, the assessee argued that the ITAT followed its prior orders for AY 2009-10 to 2011-12, and the Revenue had not challenged these, thus accepting them. The Revenue did not dispute this. Consequently, the High Court found this question to be in favour of the assessee. For the third question, the assessee pointed to a specific ITAT order in its own case that covered the issue against the Revenue, which the Revenue did not dispute. Therefore, the High Court held this question also in favour of the assessee. The operative direction was to dismiss the appeal. Questions 2 and 3 were answered in favour of the Assessee and against the Revenue.

What were the facts?

The Revenue has filed an appeal before the High Court of Karnataka challenging an order dated 24.10.2017 passed by the Income Tax Appellate Tribunal (ITAT) in ITA No.1019/Bang/2015. The appeal pertains to the assessment year 2008-2009. The High Court admitted the appeal to consider specific questions of law. The assessee is M/s. Canara Bank and the appellants are the Commissioner of Income Tax and the Joint Commissioner of Income-Tax.

What were the issues?

The High Court was to decide the following substantial questions of law: 1. Whether the Tribunal was correct in setting aside reassessment orders for assessment years 2006-07 and 2007-08, holding the reopening under Section 147 to be bad in law as it was initiated beyond four years, relying on the decision in *Multiserium Media Pvt. Ltd.*? 2. Whether the Tribunal was correct in setting aside disallowances made under Section 36(1)(vii) and (viia) by relying on its earlier orders for assessment years 2009-10 to 2011-12? 3. Whether the Tribunal was correct in setting aside the addition made on account of commission on locker rent by relying on its earlier decisions for assessment years 2010-11 and 2011-12 in the assessee's own case? Contentions: Assessee: Submitted that the first question of law does not arise for consideration and this was not disputed by the Revenue. Regarding the second question, the assessee stated that the ITAT followed its earlier order, and the Revenue had not challenged it, thus accepting the order. For the third question, the assessee contended that the issue was covered against the Revenue by a previous ITAT decision in *Commissioner of Income Tax Vs. Canara Bank*. Revenue: Did not dispute the assessee's submissions regarding the first and second questions of law. Did not dispute the assessee's submission regarding the third question of law.

Which sections of the Income-tax Act were involved?

Section 260-A,Section 147,Section 36(1)(vii),Section 36(1)(viia)

AI-generated summary — verify with the full judgment below

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ITA No. 300 of 2018 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 10TH DAY OF JANUARY, 2023 PRESENT THE HON'BLE MR JUSTICE P.S.DINESH KUMAR AND THE HON'BLE MR JUSTICE G BASAVARAJA INCOME TAX APPEAL NO. 300 OF 2018 BETWEEN: 1. THE COMMISSIONER OF INCOME TAX, CIT (A) LTU, 7TH FLOOR, BMTC BUILDING, 80 FEET ROAD, KORAMANALA, BENGALURU-560095. 2. THE JOINT COMMISSIONER OF INCOME-TAX LTU, 7TH FLOOR, BMTC BUILDING, 80 FEET ROAD, KORAMANGALA, BENGALURU-560095. …APPELLANTS (BY SRI. E I SANMATHI, SR. STANDING COUNSEL AND SRI ARAVIND K V.,SENIOR STANDING COUNSEL) AND: 1. M/S. CANARA BANK HEAD OFFICE, 112, J C ROAD, BENGALURU-56002. …RESPONDENT (BY SRI. T SURYANARAYANA, SR. ADV. FOR; SMT. TANMAYEE RAJKUMAR, ADVOCATE) Digitally signed by RAMYA D Location: High Court of Karnataka

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ITA No. 300 of 2018

THIS INCOME TAX APPEAL FILED UNDER SEC.260-A OF INCOME TAX ACT 1961, ARISING OUT OF ORDER DATED24/10/2017 PASSED IN ITA NO.1019/BANG/2015, FOR THE ASSESSMENT YEAR 2008-2009. PRAYING TO 1. FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED ABOVE AND ETC.

THIS APPEAL, COMING ON FOR FINAL HEARING, THIS DAY, P.S.DINESH KUMAR J., DELIVERED THE FOLLOWING: JUDGMENT This appeal filed by the Revenue challenging the order dated 24.10.2017 in ITA No.1019/Bang/2015 by Income Tax Appellate Tribunal1, Bengaluru has been admitted to consider following questions of law. 1. Whether on the facts and in the circumstances of the case, the Tribunal is right in law in setting aside the reassessment orders passed for the assessment years 2006-07 and 2007-08 by erroneously holding that the said reassessment order is bad in law as the reopening is under section 147 is initiated beyond 4 years by relying on the decision of the Mumbai High Court in the case of Multiserium Media Pvt.Ltd.,? 2. Whether on the facts and in the circumstances of the case, the Tribunal is right in law in setting aside the disallowances made under section 36(1)(vii) and also (viia) by relying upon 1 ITAT for short

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ITA No. 300 of 2018 its earlier orders passed for the assessment years 2009-10 to 2011-12? 3. Whether on the facts and in the circumstances of the case, the Tribunal is right in law in setting aside the addition made on account of commission on locker rent by relying upon its earlier decision for the assessment year 2010-11 and 2011-12 passed in the case of the assessee?" 2. At the out set, Shri. T.Suryanarayana, learned Senior Advocate for the assessee submits that first question of law does not arise for consideration in this appeal and the same is not disputed by Shri. E.I.Sanmathi, learned Standing Counsel for Revenue. 3. Shri.Suryanarayana, further submits that insofar as second question is concerned, the ITAT has followed its earlier order for AY2 2009-10 and 2011-12 and the said issue has not been challenged by the Revenue. Thus, the Revenue has accepted the said order. This submission is also not disputed by Shri. Sanmathi. 4. With regard to third question, Shri.Suryanarayana, submits that the issue is covered against the Revenue in 2 Assessment year

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ITA No. 300 of 2018 ITAT No.268/2018 C/w ITA No.268/2018 in Commissioner of Income Tax Vs. Canara Bank decided on 13.09.2022. This submission is also not disputed by Shri. Sanmathi. 5. Accordingly, this appeal is dismissed. 6. Questions No.2 and 3 are answered in favour of the Assessee and against the Revenue.

No costs. Sd/- JUDGE Sd/- JUDGE BH

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