PRINCIPAL COMMISSIONER OF INCOME TAX-4 vs. M/S KARNATAKA STATE FINANCIAL

1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 12TH DAY OF NOVEMBER 2020 PRESENT THE HON’BLE MR. JUSTICE ALOK ARADHE AND THE HON’BLE MR. JUSTICE H.T.NARENDRA PRASAD I.T.A. NO.462 OF 2018 BETWEEN: 1. PRINCIPAL COMMISSIONER OF INCOME TAX-4

BMTC COMPLEX, KORAMANGALA

BENGALURU. 2. ASSISTANT COMMISSIONER OF INCOME TAX

CIRCLE-4(1)(1), BMTC COMPLEX

KORAMANGALA, BENGALURU.

... APPELLANTS (BY SRI. E.I. SANMATHI, ADV.,) AND: M/S. KARNATAKA STATE FINANCIAL CORPORATION LTD., KSFC BHAVAN, NO.1/1 THIMMAIAH ROAD NEAR CANTONMENT RAILWAY STATION BENGALURU-560052 PAN: AAACK 9408H. ... RESPONDENT (BY SRI. SANDEEP HUILGOL, & SRI. BHARADWAJ SHESHADRI, ADVS.) - - -

2 THIS I.T.A. IS FILED UNDER SECTION 260-A OF I.T.ACT, 1961, ARISING OUT OF ORDER DATED 31-01-2018 PASSED IN ITA NO.888/BANG/2017, FOR THE ASSESSMENT YEAR 2012-13, PRAYING TO: I. DECIDE THE FOREGOING QUESTION OF LAW AND/OR SUCH OTHER QUESTIONS OF LAW AS MAY BE FORMULATED BY THE HON'BLE COURT AS DEEMED FIT. II. SET ASIDE THE APPELLATE ORDER DATED 31-01-2018 PASSED BY THE INCOME TAX APPELLATE TRIBUNA, 'C' BENCH, BANGALORE, IN APPEAL PROCEEDINGS NO.ITA NO.888/BANG/2017 FOR THE ASSESSMENT YEAR 2012-13 AS SOUGHT FOR IN THIS APPEAL; AND TO GRANT SUCH OTHER RELIEF AS DEEMED FIT, IN THE INTEREST OF JUSTICE. THIS I.T.A. COMING ON FOR HEARING, THIS DAY, ALOK ARADHE J., DELIVERED THE FOLLOWING: JUDGMENT Mr.E.I.Sanmathi, learned counsel for the revenue has entered appearance through video conferencing. Mr.Sandeep Huligol and Mr.Bharadwaj Sheshadri, learned counsel for the assessee. 2. This appeal under Section 260-A of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’, for short) has been preferred by the revenue. The subject matter of the appeal pertains to the Assessment Year 2012-13. The appeal was admitted by a Bench of this

3 Court vide order dated 07.11.2019 to consider the following substantial question of law: "Whether on the facts and circumstances of the case, the Tribunal and CIT are right in deleting the disallowance made under section - r.w.r. 8D2(ii) on the ground that no exempt income was earned when the assessing officer has correctly followed the instructions of the CBDT in Circular No.5/2014 dated 11/02/2014." 3. When the matter was taken up today, learned counsel for the assessee submitted that the aforesaid substantial question of law has already been answered against the revenue in assessee's own case in ITA No.1004/2017 vide judgment dated 19.07.2018. The aforesaid submission could not be disputed by the learned counsel for the revenue. 4. For the reasons assigned by a Bench of this Court in judgment dated 19.07.2018 passed in ITA No.1004/2017, the substantial question of law framed in

4 this appeal is answered against the revenue and in favour of the assessee. In the result, we do not find any merit in the appeal and the same is dismissed. Sd/- JUDGE Sd/- JUDGE RV