THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE - 2(1), MANGALORE vs. M/S THE SOUTH CANARA DISTRICT CENTRAL CO-OP BANK LTD, MANGALURU

This appeal by the Revenue against the order dated 30-12-2017 passed by the Commissioner of Income Tax (Appeals), Mangaluru [‘CIT(A)’] for assessment year 2014-15.

Ground Nos. 1, 6 and 7 raised by the Revenue are general in nature, hence, require no adjudication.

Ground Nos. 2 and 3 raised by the Revenue challenging the action of CIT(A) in deleting the addition made on account of interest accrued on investment on Government securities in the facts and circumstances of the case.

The AO discussed the issue at para 4.7 of the assessment order and brought to tax interest accrued on Non SLR investments Rs.14,81,52,740/-. The CIT(A) following the order of ITAT, Bangalore Benches in assessee’s own case for A.Ys. 2010-11 to 2013-14 deleted the addition made by the AO. The ld. DR did not dispute the same. Therefore, we do not find any infirmity in the order of CIT(A) and it is justified. Thus, ground Nos. 2 and 3 raised by the Revenue are dismissed.

Ground No. 4 raised by the Revenue challenging the action of CIT(A) in deleting the addition made on account of non-business expenditure paid to Navodaya Grama Vikasa Charitable Trust.

The AO discussed the same at para 6 of the assessment order. According to the AO the lump sum amounts monthly paid to Navodaya Grama Vikasa Charitable Trust held to be non-business expenditure and brought to tax Rs.1,49,56,800/- by holding that there was no relationship with the activities of the assessee. The CIT(A) followed the order of ITAT, Bangalore Benches in assessee’s own case for A.Ys. 2010-11 to 2013-14 and deleted the addition made by the AO. The ld. DR did not bring on record any order contrary to the view taken by the Tribunal in assessee’s own case. Therefore, we do not find any infirmity in the order of CIT(A) and it is justified. Thus, ground No. 4 raised by the Revenue is dismissed.

Ground No. 5 raised by the Revenue challenging the action of CIT(A) in deleting the addition made on account of amortization of premium paid on Government securities.

The assessee claimed expenses relating to amortization of premium paid on Government securities under the category held to maturity. The AO disallowed the same. The CIT(A) following the order of ITAT, Bangalore Benches in assessee’s own case for A.Ys. 2010-11 to 2013-14 deleted the addition made by the AO vide para 4.3.3. The ld. DR did not dispute the same. Therefore, we do not find any infirmity in the order of CIT(A) and it is justified. Thus, ground No. 5 raised by the Revenue is dismissed.

In the result, the appeal of Revenue is dismissed.