M/S MYSORE CO-OPERATIVE BANK LIMITED,MYSORE vs. ADDITIONAL COMMISSIONER OF INCOME TAX RANGE-2, MYSORE

Present appeal has been filed by assessee against order dated 22/02/2019 passed by the Ld. CIT (A), Mysore on following grounds of appeal:

The assessee is a co-operative bank and filed its original return of income on 30/09/2011. The case was selected for scrutiny and notices under section 143(2) was issued to assessee in response to which the representative of the assessee appeared before the Ld.AO and called requisite details as called for. Before completing the assessment in the absence of satisfactory explanation the Ld.AO made disallowances and computed total income in the hands of assessee at Rs.4,51,92,800/-. 2.1 Aggrieved by the order passed by the Ld.AO, assessee preferred appeal before the Ld.CIT(A).

The Ld.CIT(A) while completing appellate hearing concluded that the addition on disallowance made under section 36(1)(viia) of the act was not pressed by the Ld.AR and thereby dismissed the ground. In respect of the disallowance made regarding general body meeting expenses under section 37 (1) the Ld.CIT(A) held that as assessee did not substantiate its claim by with documentary evidences the addition is upheld. The other issues raised by assessee was allowed. 3.1 Aggrieved by the order of Ld.CIT(A) assessee is in appeal before us now.

Ground No.3-5 Ld.AR submitted that the issue was remanded by coordinate bench of this Tribunal in assessee’s own case in & 2000/Bang/2017 for assessment year 2008-09 by order dated 01/03/2019. He submitted that, the Ld.AO allowed the claim in the remand proceedings by ITAT while giving order effect to an order passed in assessment year 2008-09.

We have perused the submissions advanced by both sides in light of records placed before us. 5.1 For year under consideration, assessee claimed expenses towards annual general meeting which was disallowed by the Ld.AO. Coordinate bench of this Tribunal in assessee’s own case (supra) remanded the issue to Ld.AO for fresh consideration. In the remand proceedings, Ld.AO disallowed the claim to the extent that were not supported by any bills and vouchers. 5.2 The Ld.AR submits that similar expenditure was incurred by assessee for year under consideration by holding that these are not incurred wholly and exclusively for purposes of business. We note that assessee mandatorily has to conduct general body meetings annually. Also that, except for bifurcating expenses, nothing else has been provided by assessee to substantiate its claim. We are therefore inclined to remand the issue back to Ld.AO for verification. Assessee is directed to file all relevant details in support of its claim. Accordingly these grounds raised

We have perused submissions advanced by both sides in light of records placed before us. 7.1 Before us the assessee had submitted that though the nomenclatures used is provision for non-performing asset but actually with the provision has been created for bad and doubtful debts. The deduction is in excess of the provision for bad and doubtful debts which the Ld.AO disallows. Ld.AR placed reliance on the decision of Hon’ble Karnataka High Court in case of CIT vs Davangere District Central Cooperative Bank Ltd. reported in (2021) 123 Taxmann.com 37 in support of his contention. 7.2 We note that Hon’ble Court in the above decision has observed as under: