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Income Tax Appellate Tribunal, ‘A’ BENCH: CHENNAI
Before: SHRI V. DURGA RAO & SHRI G. MANJUNATHA
Indian Overseas Bank, The Asst. Commissioner of 763, Annasalai, Income Tax, Chennai – 600 002. Vs. LTU(2), Chennai. [PAN: AAACI 1223J] (&'थ(/Respondent) (अपीलाथ�/Appellant) अपीलाथ( की ओर से/ Appellant by : Mr. C. Naresh, CA &'थ( की ओर से /Respondent by : Mr. Clement Ramesh Kumar, CIT सुनवाई की तारीख/Date of Hearing : 28.09.2021 घोषणा की तारीख /Date of Pronouncement : 30.09.2021 आदेश / O R D E R
Per V. Durga Rao, Judicial Member:
This appeal filed by the assessee is directed against the order of the learned Commissioner of Income Tax (Appeals)-17, Chennai in dated 31.01.2019 relevant to the Assessment Year 2011-12.
The brief facts of the case are that the assessee is a banking company and filed its return of income by declaring a total income of Rs. 550,19,08,710/-. Subsequently, the case of the assessee was selected for scrutiny, after following due procedure assessment was completed u/s. 143(3) of the Income Tax Act, 1961 (hereinafter as “the Act”) on 2803.2013. Subsequently, the assessment was reopened u/s. 147 of the Act by issued a notice u/s. 148 of the Act on 30.03.2016 and assessment was completed u/s 143(3) r/w s. 147 of the Act.
The first ground raised by the assessee before us that the reopening of the assessment in this case is invalid for the reason that the A.O has not recorded reasons properly and he has not mentioned that there is no escapement of income therefore, the reopening is invalid.
The ld. D.R has submitted that the similar issue of reopening already came up before the Hon’ble ITAT “C” Bench, Chennai for assessment year 2008-09 in dated 06.06.2019 and the Tribunal has upheld the reopening. The Ld. D.R has also submitted that the A.O clearly mentioned that there is an escapement of income and therefore, he strongly supported the orders passed by the A.O and Ld. CIT(A).
We have heard both the sides, perused the materials available on record and gone through the orders of the authorities below. The issue involved in this ground is whether reopening is valid or not? To decide the above issue, the reasons recorded by the A.O are extracted as under:
“Reasons:- “It was noticed that She assessee had reserved Rs.209.61 Crore (581.58 - 371.97) under Agricultural Debt waiver and Debt Relief Scheme 2008 as Third installment during the year The provision of debt which was already claimed and allowed as bad debt This is required to be brought to tax.”. You are requested to furnish the objection (if any) before the undersigned on or before 25.07.2016”.”
We find from the above reasons that the finding given by the A.O is that the assessee has already claimed as a provision for debt and same is allowed. Subsequently, the assessee has received an amount of Rs. 209.61 crores under Agricultural Debt Waiver and Debt Relief Scheme, 2008. It is very clear that the amount, which is already claimed as a bad debt by the assessee and again assessee has received the same amount under debt waiver and debt relief scheme.
According to the A.O, there is an escapement of income. Accordingly, the A.O has issued a notice u/s. 148 of the Act and completed assessment u/s. 143(3) r/w. s. 147 of the Act on 29.12.2017.
4 -: 7. In view of the above, we are of the opinion that the A.O has correctly recorded the reasons and reopened the assessment and completed the assessment u/s. 147 of the Act thus, the reopening is valid.
So far as another ground raised by the assessee is concerned, whether the amount received under Agricultural Debt Relief and Debt Waiver Scheme is taxable or not?
The ld. Counsel or the assessee has submitted that the similar issue already came up before the Hon’ble ITAT “C” Bench, Chennai for assessment years 2008-09, 2009-10 & 2012-13 in 1880 & 1881/Chny/2017 vide order dated 06.06.2019 directed the A.O to re- examine the issue afresh in accordance with law. For the sake of convenience, the relevant portion of the order is extracted as under:
“5.5.3 We have considered the rival submissions on either side and perused the material available on record. The assessee admittedly received Rs.234.53 crores towards first installment on account of Agricultural Debt Waiver and Debt Relief Scheme 2008. The CIT(A) found that it is possible that the interest income would not be offered to tax whereas the principal portion would be included in the proviso account. Therefore CIT(A) directed the assessee to furnish the relevant information before the Assessing Officer and directed the Assessing Officer to examine the matter. Under the scheme of Income-Tax Act, the CIT(A) has no power to set aside the assessment for reconsideration. However this Tribunal is of the considered opinion, it has to be verified whether the interest income was offered for taxation earlier. Accordingly in exercise of jurisdiction conferred on this Tribunal, the orders of both the authorities below are set aside and the issue is remitted back to the file of the Assessing Officer. The Assessing Officer shall re-examine the matter
5 -: afresh in accordance with law after giving reasonable opportunity to the assessee.” 10. We therefore respectfully following the order passed by the Tribunal in the assessee’s own case, we direct the A.O to re-examine the issue afresh in accordance with law. Thus, this ground of appeal raised by the assessee is allowed for statistical purposes.
In the result, the appeal filed by the assessee is partly allowed for statistical purposes.
Order pronounced on 30th September, 2021 in Chennai.