Assistant Commissioner of Income-tax,, v. Samarth Sahakari Bank Ltd.,, Solapur

ITA 2244/PUN/2013 | 2009-2010
Pronouncement Date: 26-11-2014 | Result: Dismissed

Appeal Details

RSA Number 224424514 RSA 2013
Assessee PAN AAAJS1309P
Bench Pune
Appeal Number ITA 2244/PUN/2013
Duration Of Justice 10 month(s) 25 day(s)
Appellant Assistant Commissioner of Income-tax,,
Respondent Samarth Sahakari Bank Ltd.,, Solapur
Appeal Type Income Tax Appeal
Pronouncement Date 26-11-2014
Appeal Filed By Department
Order Result Dismissed
Bench Allotted A
Tribunal Order Date 26-11-2014
Date Of Final Hearing 27-10-2014
Next Hearing Date 27-10-2014
Assessment Year 2009-2010
Appeal Filed On 31-12-2013
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A PUNE BEFORE: SHRI R.S. PADVEKAR JUDICIAL MEMBER AND SHRI R.K. PANDA ACCOUNTANT MEMBER ITA NO S. 2244 & 2245 /PN/20 1 3 ASSESSMENT YEAR S : 200 9 - 10 & 20 10 - 11 ASSISTANT COMMIS SIONER OF INCOME TAX CIRCLE 2 SOLAPUR VS. SAMARTH SAHAKARI BANK LTD. FIRST FLOOR ANTROLIKAR SHOPPING CENTRE DATTA CHOWK SOLAPUR (APPELLANT) (RESPONDENT) PAN NO. AAAJS1309P CO NOS. 93 & 94/PN/2014 ASSESSMENT YEAR S : 2009 - 10 & 2010 - 11 SAMARTH SAHAKARI BANK LTD. FIRST FLOOR ANTROLIKAR SHOPPING CENTRE DATTA CHOWK SOLAPUR VS. ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE 2 SOLAPUR ( CROSS OBJECTOR ) (RESPONDENT) PAN NO. AAAJS1309P REVENUE BY: SHRI B.C. MALAKAR ASSESSEE B Y: SHRI S.N. PURANIK DATE OF HEARING : 27 - 10 - 2014 DATE OF PRONOUNCEMENT : 26 - 11 - 2014 ORDER PER R.S . PADVEKAR JM : - THESE TWO APPEALS ARE FILED BY THE REVENUE AND TWO C ROSS O BJECTIONS ARE FILED BY THE ASSESSEE CHALLENGING THE IMPUGNED ORDER S OF THE LD. CIT(A) - III PUNE DATED 17 - 10 - 2013 FOR THE A.YS. 2009 - 10 & 2010 - 11. THE REVENUE HAS TAKEN THE MULTIPLE GROUNDS IN BOTH THE APPEAL S . IN THE APPEAL FOR A.Y. 2009 - 10 SAVE THE GROUND NO. 1 OTHER GROUNDS ARE ARGUMENTATIVE . GROUND NO. 1 READS AS UNDER : 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE HON'BLE CIT(A) - III PUNE ERRED IN DELETING THE ADDITION OF 2 ITA NO S. 2244 & 2245 /PN/2013 SAMARTH SAHAKARI BANK LTD. SOLAPUR RS.60 62 267/ - MADE BY THE A.O. ON ACCOUNT OF ACCRUED INTEREST ON NON PERFORMING ASSETS U/S. 43D OF THE I.T. ACT 1961. 2. THE FACTS WHICH ARE EMERGING FROM THE RECORDS ARE AS UNDER. THE ASSESSEE IS A CO - OPERATIVE SOCIETY ENGAGED IN THE BUSINESS OF BANKING. THE ASSESSEE FILED THE RETURN OF INCOME FOR THE A.Y. 2009 - 10 DECLARING TOTAL INCOME OF RS.95 30 300/ - . IT WAS NOTICED BY T HE ASSESSING OFFICER THAT THE TOTAL ACCRUED INTEREST ON NPA AT THE END OF THE YEAR STOOD AT RS.60 62 267/ - WHILE THE ACCRUED INTEREST OF RS.1 80 22 964/ - WAS SHOWN AS CLOSING BALANCE AS ON 31 - 03 - 2009 WHICH WAS ON ACCOUNT OF OVERDUE INTEREST ON NPA. THE AS SESSING OFFICER SOUGHT THE EXPLANATION OF THE ASSESSEE WHY THE INTEREST OVERDUE ON NPA WAS NOT OFFERED TO TAX. THE ASSESSEE SUBMITTED THAT THERE HAS BEEN REVERSAL OF INTEREST INCOME ON ALL NPAS WHICH W AS CLAIMED TO HAVE BEEN EFFECTED IN COMPLIANCE TO THE DIRECTIVES ISSUED BY THE RESERVED BANK OF INDIA. THE ASSESSEE ALSO SUBMITTED THAT AS PER THE SAID DIRECTIVES OF THE RBI THE INCOME RECOGNITION HAS TO BE OBJECTIVE AND BASED ON THE RECORD OF RECOVERY AND HENCE THE INTEREST INCOME FROM NPAS IS NOT RECOGNI ZED ON ACCRUAL BASIS BUT IT WAS BOOKED AS AND WHEN SUCH INCOME WAS ACTUALLY RECEIVED. 3. THE ASSESSING OFFICER REJECTED THE CONTENTION OF THE ASSESSEE AS IN HIS OPINION AS PER THE PROVISIONS OF SEC. 145 THE ASSESSEE SHOULD HAVE OFFERED THE ACCRUED OVERDU E INTEREST ON THE NPA FOR TAX AS THE ASSESSEE WAS FOLLOWING THE MERCANTILE SYSTEM OF ACCOUNTING. THE ASSESSING OFFICER DID NOT AGREE WITH THE ARGUMENT THAT THE ASSESSEE IS OFFERING THE INTEREST ON NPA ON THE RECEIPT BASIS. THE ASSESSING OFFICER ALSO NOTE D THAT THE ASSESSEE IS NOT AN INSTITUTION SPECIFIED IN SEC. 43D AND HENCE THE ASSESSEE CANNOT ESCAPE FROM THE TAXATION. THE ASSESSING OFFICER THEREFORE BROUGHT TO TAX THE OVERDUE INTEREST ON NPA AND MADE THE ADDITION OF RS.60 62 267/ - . 3 ITA NO S. 2244 & 2245 /PN/2013 SAMARTH SAHAKARI BANK LTD. SOLAPUR 4. BEFORE THE LD. CIT(A) THE ASSESSEE POINTED OUT THAT THE ISSUE HAS BEEN DECIDED BY THE ITAT PUNE IN THE ASSESSEE OWN CASE FOR THE A.YS. 2007 - 08 AND 2009 - 10 IN ITA NOS. 400 & 401/PN/2012. THE LD. CIT(A) ACCORDINGLY ALLOWED THE CLAIM OF THE ASSESSEE AND DELETED THE AD DITION. NOW THE REVENUE IS IN APPEAL BEFORE US FOR THE A.Y. 2009 - 10. 5. SO FAR AS THE A.Y. 2010 - 11 IS CONCERNED THE REVENUE HAS TAKEN THE FOLLOWING EFFECTIVE GROUND : ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE HON'BLE CIT(A) - III PUNE ERRED IN DELETING THE ADDITION OF RS. 37 55 889/ - MADE BY THE A.O. ON ACCOUNT OF ACCRUED INTEREST ON NON PERFORMING ASSETS U/S. 43D OF THE I.T. ACT 1961. 6. ON THE ISSUE OF ADDITION OF ACCRUED INTEREST ON NPA FOR THE A.Y. 2010 - 11 THE ASSESSING O FFICER HAS MADE THE ADDITION OF RS.37 55 889/ - WHICH WAS IN RESPECT OF OVERDUE INTEREST ON NPA. THE ASSESSING OFFICER HAS GIVEN THE REASONS FOR MAKING THE ADDITION WHICH ARE THE SAME AS IN THE A.Y. 2009 - 10. IN THIS YEAR ALSO THE LD. CIT(A) DELETED THE AD DITION HENCE THE REVENUE IS IN APPEAL BEFORE US. 7. WE HAVE HEARD THE PARTIES AND PERUSED THE RECORD. WE FIND THAT THE ISSUE STANDS COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE ITAT A BENCH PUNE IN THE CASE OF ACIT CIRCLE - 3 NANDED VS. THE OMERGA JANTA SAHAKARI BANK LTD. OSMANABAD BEING ITA NO. 350/PN/2013 ORDER DATED 31 - 10 - 2013. THE OPERATIVE PART OF THE REASONS AND FINDINGS OF THE TRIBUNAL ARE AS UNDER: 8. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIONS. IN SO FAR AS THE APPLICA BILITY OF SECTION 43D OF THE ACT TO THE ASSESSEE IS CONCERNED THERE IS A CONVERGENCE OF OPINION BETWEEN THE ASSESSEE AND THE REVENUE TO THE EFFECT THAT THE SAME IS NOT APPLICABLE TO THE ASSESSEE. OSTENSIBLY ASSESSEE IS A CO - OPERATIVE BANK CARRYING ON BA NKING BUSINESS IN TERMS OF A LICENSE GRANTED BY RBI AND IS NOT A SCHEDULED BANK INCLUDED IN SECOND SCHEDULE OF RBI SO AS TO FALL 4 ITA NO S. 2244 & 2245 /PN/2013 SAMARTH SAHAKARI BANK LTD. SOLAPUR WITHIN THE SCOPE OF SECTION 43D OF THE ACT. NOTABLY SECTION 43D OF THE ACT PRESCRIBES THAT INTEREST INCOME ON SUCH CATEGORI ES OF BAD AND DOUBTFUL DEBTS AS PRESCRIBED BY THE RBI GUIDELINES SHALL BE CHARGEABLE TO TAX IN THE YEAR IN WHICH SUCH INTEREST INCOME IS CREDITED BY THE ASSESSEE IN THE PROFIT AND LOSS ACCOUNT OR IN THE YEAR OF ACTUAL RECEIPT WHICHEVER IS EARLIER. SINCE ASSESSEE IS NOT AN ENTITY COVERED WITHIN THE SCOPE OF SECTION 43D OF THE ACT THE PRESENT CONTROVERSY CANNOT BE ADJUDICATED IN THE LIGHT OF SECTION 43D OF THE ACT AND IT IS LIABLE TO BE DECIDED ON GENERAL PRINCIPLES AS TO WHETHER THE IMPUGNED INCOME HAS A CCRUED TO THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION. 9. IN THIS CONNECTION WE FIND THAT THE VISAKHAPATNAM BENCH OF THE TRIBUNAL IN THE CASE OF THE DURGA COOPERATIVE URBAN BANK LTD. (SUPRA) HAS CONSIDERED AN IDENTICAL CONTROVERSY. THE ASSESSEE BE FORE THE VISAKHAPATNAM BENCH WAS A CO - OPERATIVE BANK OPERATING UNDER A LICENSE ISSUED BY RBI BUT WAS NOT A SCHEDULED BANK SO AS TO FALL WITHIN THE SCOPE OF SECTION 43D OF THE ACT. THE ISSUE RELATED TO TAXABILITY OF INTEREST INCOME RELATING TO NPAS WHIC H AS PER THE REVENUE WAS LIABLE TO BE TAXED ON ACCRUAL BASIS IN LINE WITH MERCANTILE SYSTEM OF ACCOUNTING ADOPTED BY THE ASSESSEE THEREIN. THE ASSESSEE ON THE OTHER HAND CONTENDED THAT HAVING REGARD TO THE GUIDELINES ISSUED BY RBI REGARDING ACCOUNTING O F INTEREST ON NPAS NO INTEREST INCOME ACCRUED IN RESPECT OF NPAS AND THAT THE SAME WAS TO BE TAXED ONLY ON RECEIPT BASIS. THE TRIBUNAL OBSERVED THAT THE QUESTION OF TAXABILITY OF INTEREST ON NPAS CLASSIFIED BY RBI WAS CONSIDERED BY THE HONBLE DELHI HIG H COURT IN THE CASE OF M/S VASISTH CHAY VYAPAR LTD. (SUPRA) WHEREIN AFTER CONSIDERING THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF SOUTHERN TECHNOLOGIES LTD. (SUPRA) IT WAS HELD THAT INTEREST INCOME RELATABLE TO NPAS WAS NOT INCLUDIBLE IN TOTAL INCOME ON ACCRUAL BASIS SINCE THE SAME DID NOT ACCRUE TO THE ASSESSEE. THE FOLLOWING DISCUSSION BY THE VISAKHAPATNAM BENCH OF THE TRIBUNAL IN THE CASE OF THE DURGA COOPERATIVE URBAN BANK LTD. (SUPRA) IS WORTHY OF NOTICE : - 8. WE HAVE HEARD THE RIVAL CON TENTIONS AND CAREFULLY PERUSED THE RECORD. THE QUESTION OF TAXABILITY OF INTEREST ON NPAS HAS BEEN CONSIDERED BY THE HON'BLE DELHI HIGH COURT IN THE CASE OF M/S VASISTH CHAY VYAPAR LTD (SUPRA); WHEREIN THE HON'BLE DELHI HIGH COURT TOOK INTO ACCOUNT THE DEC ISION 5 ITA NO S. 2244 & 2245 /PN/2013 SAMARTH SAHAKARI BANK LTD. SOLAPUR RENDERED BY THE HON'BLE SUPREME COURT IN THE CASE OF SOUTHERN TECHNOLOGIES LTD (SUPRA). IN THE CASE OF M/S VASISTH CHAY VYAPAR LTD THE ASSESSEE THEREIN WAS A NON BANKING FINANCIAL COMPANY AND IT WAS ALSO BOUND BY THE PRUDENTIAL NORMS DIRECTIONS IS SUED BY THE RESERVE BANK OF INDIA FOR INCOME RECOGNITION AND ASSET CLASSIFICATION. THE ASSESSEE DID NOT INCLUDE THE INTEREST INCOME RELATABLE TO NPA ASSETS IN ITS TOTAL INCOME. THE ASSESSING OFFICER HOWEVER ADDED THE SAID INTEREST AS THE INCOME OF THE AS SESSEE BY HOLDING THAT IT HAD ACCRUED TO THE ASSESSEE EVEN IT WAS NOT REALIZED AS THE ASSESSEE WAS FOLLOWING MERCANTILE SYSTEM OF ACCOUNTING. THE LEARNED CIT (A) AFFIRMED THE ORDER OF THE ASSESSING OFFICER. HOWEVER THE ITAT DELETED THE AFORESAID INCOME. HENCE THE REVENUE PREFERRED APPEAL BEFORE THE HON'BLE DELHI HIGH COURT. 8.1 AFTER HEARING THE RIVAL SUBMISSIONS THE HON'BLE DELHI HIGH COURT TOOK NOTE OF SEC.45Q OF RESERVE BANK OF INDIA ACT WHICH READS AS UNDER: CHAPTER IIIB TO OVERRIDE OTHER LAWS. 45Q. THE PROVISIONS OF THIS CHAPTER SHALL HAVE EFFECT NOTWITHSTANDING ANYTHING INCONSISTENT THEREWITH CONTAINED IN ANY OTHER LAW FOR THE TIME BEING IN FORCE OR ANY INSTRUMENT HAVING EFFECT BY VIRTUE OF ANY SUCH LAW. THE HIGH COURT TOOK NOTE OF THE FACT T HAT THE PROVISION OF 45Q OF RESERVE BANK OF INDIA HAS OVERRIDING EFFECT OVER ANY OTHER LAW. THEN THE HON'BLE HIGH COURT ALSO CONSIDERED ACCOUNTING STANDARD AS - 9 ON REVENUE RECOGNITION AND ALSO EXTRACTED FOLLOWING RELEVANT PORTION FROM THE SAID ACCOUNTI NG STANDARD: 9. EFFECT OF UNCERTAINTIES ON REVENUE RECOGNITION 9.1 RECOGNITION OF REVENUE REQUIRES THAT REVENUE IS A MEASURABLE AND THAT AT THE TIME OF SALE OR THE RENDERING OF THE SERVICE IT WOULD NOT BE UNREASONABLE TO EXPECT ULTIMATE COLLECTION. 9.2 WHERE THE ABILITY TO ASSESS THE ULTIMATE COLLECTION WITH REASONABLE CERTAINTY IS LACKING AT THE TIME OF RAISING ANY 6 ITA NO S. 2244 & 2245 /PN/2013 SAMARTH SAHAKARI BANK LTD. SOLAPUR CLAIM E.G. FOR ESCALATION OF PRICE EXPORT INCENTIVES INTEREST ETC. REVENUE RECOGNITION IS POSTPONED TO THE EXTENT OF UNCERTAINTY INVOL VED. IN SUCH CASES IT MAY BE APPROPRIATE TO RECOGNIZE REVENUE ONLY WHEN IT IS REASONABLY CERTAIN THAT THE ULTIMATE COLLECTION WILL BE MADE. WHERE THERE IS NO UNCERTAINTY AS TO ULTIMATE COLLECTION REVENUE IS RECOGNIZED AT THE TIME OF SALE OR RENDERING OF SERVICE EVEN THOUGH PAYMENTS ARE MADE BY INSTALMENTS. 9.3 WHEN THE UNCERTAINTY RELATING TO COLLECTABILITY ARISES SUBSEQUENT TO THE TIME OF SALE OR THE RENDERING OF THE SERVICE IT IS MORE APPROPRIATE TO MAKE A SEPARATE PROVISION TO REFLECT THE UNCERTAINTY RATHER THAN TO ADJUST THE AMOUNT OF REVENUE ORIGINALLY RECORDED. 9.4 AN ESSENTIAL CRITERION FOR THE RECOGNITION OF REVENUE IS THAT THE CONSIDERATION RECEIVABLE FOR THE SALE OF GOODS THE RENDERING OF SERVICES OR FROM THE USE OF OTHERS OF ENTERPRISE RESOU RCES IS REASONABLY DETERMINABLE. WHEN SUCH CONSIDERATION IS NOT DETERMINABLE WITHIN REASONABLE LIMITS THE RECOGNITION OF REVENUE IS POSTPONED. 9.5 WHEN RECOGNITION OF REVENUE IS POSTPONED DUE TO THE EFFECT OF UNCERTAINTIES IT IS CONSIDERED AS REVENUE OF THE PERIOD IN WHICH IT IS PROPERLY RECOGNIZED. 8.2 THE DELHI HIGH COURT ALSO CONSIDERED THE DECISION RENDERED IN THE FOLLOWING CASES: I) CIT VS. ELGI FINANCE LTD. 293 ITR 357 (MAD) II) CIT VS. KKM INVESTMENTS (CAL) SLP DISMISSED BY SUPREME COURT (3 10 ITR 4) III) CIT VS. MOTOR CREDIT CO (P) LTD. 127 ITR 572 (MAD) IV) UCO BANK VS. CIT 237 ITR 889 (SC) V) CIT VS. SHOORJI VALLABHDAS & CO 46 ITR 144 (SC) VI) GODHRA ELECTRICITY CO. LTD. VS.CIT 225 ITR 746 VII) CIT VS. GOYAL M G GASES (P) LTD. 303 ITR 159 (DEL) VIII) CIT VS. EICHER LTD. ITA NO.431/2009 DATED 15.7.2009 (DEL) 7 ITA NO S. 2244 & 2245 /PN/2013 SAMARTH SAHAKARI BANK LTD. SOLAPUR 8.3 AFTER CONSIDERING THE ACCOUNTING STANDARD 9 AND THE VARIOUS CASE LAW LISTED ABOVE THE HON'BLE DELHI HIGH COURT HELD THAT THE INTEREST ON NPA ADVANCE CANNOT BE TREATED AS ACCRUED TO THE ASSESSEE. 8.4 BEFORE THE DELHI HIGH COURT THE REVENUE TOOK SUPPORT OF THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF SOUTHERN TECHNOLOGIES LTD (SUPRA). THE DELHI HIGH COURT CONSIDERED THE SAID DECISION OF HON'BLE APEX COURT AND EXPLAINED THE SAME AS UNDER: WE HAVE ALREADY HELD THAT EVEN UNDER THE INCOME TAX ACT INTEREST INCOME HAD NOT ACCRUED. MOREOVER THIS SUBMISSION OF MR. SABHARWAL IS BASED ENTIRELY ON THE JUDGMENT OF THE SUPREME COURT IN THE CASE OF SOUTHERN TECHNOLOGY ( SUPRA). NO DOUBT IN FIRST BLUSH READING OF THE JUDGMENT GIVES AN INDICATION THAT THE COURT HAS HELD THAT RESERVE BANK OF INDIA ACT DOES NOT OVERRIDE THE PROVISIONS OF THE INCOME TAX ACT. HOWEVER WHEN WE EXAMINE THE ISSUE INVOLVED THEREIN MINUTELY AND DE EPLY IN THE CONTEXT IN WHICH THAT HAD ARISEN AND CERTAIN OBSERVATIONS OF THE APEX COURT CONTAINED IN THAT VERY JUDGMENT WE FIND THAT THE PROPOSITION ADVANCED BY MR.SABHARWAL MAY NOT BE ENTIRELY CORRECT. IN THE CASE BEFORE THE SUPREME COURT THE ASSESSEE A NBFC DEBITED RS.81 68 516 AS PROVISION AGAINST NPA IN THE PROFIT AND LOSS ACCOUNT WHICH WAS CLAIMED AS DEDUCTION IN TERMS OF SECTION 36(1) (VII) OF THE ACT. THE ASSESSING OFFICER DID NOT ALLOW THE DEDUCTION CLAIMED AS AFORESAID ON THE GROUND THAT THE PRO VISION OF NPA WAS NOT IN THE NATURE OF EXPENDITURE OR LOSS BUT MORE IN THE NATURE OF A RESERVE AND THUS NOT DEDUCTIBLE UNDER SECTION 36(I)(VII) OF THE ACT. THE ASSESSING OFFICER HOWEVER DID NOT BRING TO TAX RS.20 34 605/ - AS INCOME (BEING INCOME ACCRUED UNDER THE MERCANTILE SYSTEM OF ACCOUNTING). THE DISPUTE BEFORE THE APEX COURT CENTERED AROUND DEDUCTIBILITY OF PROVISION FOR NPA. AFTER ANALYZING THE PROVISIONS OF THE RESERVE BANK OF INDIA ACT THEIR LORDSHIPS OF THE APEX COURT OBSERVED THAT IN SO FAR AS THE PERMISSIBLE DEDUCTIONS OR EXCLUSIONS UNDER THE ACT ARE CONCERNED THE SAME ARE ADMISSIBLE ONLY IF SUCH DEDUCTIONS/EXCLUSIONS SATISFY THE RELEVANT CONDITIONS STIPULATED THEREFORE UNDER THE ACT. TO THAT EXTENT IT WAS OBSERVED THAT THE PRUDENTIAL NORMS 8 ITA NO S. 2244 & 2245 /PN/2013 SAMARTH SAHAKARI BANK LTD. SOLAPUR DO NOT OVERRIDE THE PROVISIONS OF THE ACT. HOWEVER THE APEX COURT MADE A DISTINCTION WITH REGARD TO INCOME RECOGNITION AND HELD THAT INCOME HAD TO BE RECOGNIZED IN TERMS OF THE PRUDENTIAL NORMS EVEN THOUGH THE SAME DEVIATED FROM MERCANTILE SYSTEM OF AC COUNTING AND/OR SECTION 45 (SIC. 145) OF THE INCOME TAX ACT. IT CAN BE SAID THEREFORE THAT THE APEX COURT APPROVED THE REAL INCOME THEORY WHICH IS ENGRAINED IN THE PRUDENTIAL NORMS FOR RECOGNITION OF REVENUE BY NBFC. 9. THE HON'BLE SUPREME COURT IN T HE CASE OF M/S SOUTHERN TECHNOLOGIES LTD (SUPRA) DISSECTED THE MATTER INTO TWO PARTS VIZ. A) INCOME RECOGNITION AND B) PERMISSIBLE DEDUCTION/EXCLUSIONS UNDER THE INCOME TAX ACT. IN SO FAR AS INCOME RECOGNITION IS CONCERNED THE HON'BLE SUPREME COURT HELD THAT SECTION 145 OF THE INCOME TAX ACT HAS NO ROLE TO PLAY AND THE ASSESSING OFFICER HAS TO FOLLOW RESERVE BANK OF INDIA DIRECTIONS 1998 SINCE BY VIRTUE OF 45Q OF THE RESERVE BANK OF INDIA ACT AN OVERRIDING EFFECT IS GIVEN TO THE DIRECTIONS OF RESERVE BA NK OF INDIA VIS - - VIS INCOME RECOGNITION PRINCIPLES IN THE COMPANIES ACT 1956. IN SO FAR AS COMPUTATION OF INCOME UNDER THE INCOME TAX ACT IS CONCERNED (WHICH INVOLVES DEDUCTION OF PERMISSIBLE DEDUCTIONS AND EXCLUSIONS) THE ADMISSIBILITY OF SUCH DEDUCTION S SHALL BE GOVERNED BY THE PROVISIONS OF THE INCOME TAX ACT. THE RELEVANT OBSERVATIONS OF THE HON'BLE SUPREME COURT ARE EXTRACTED BELOW: APPLICABILITY OF SECTION 145 40. AT THE OUTSET WE MAY STATE THAT IN ESSENCE RBI DIRECTIONS 1998 ARE PRUDENTIAL/PROV ISIONING NORMS ISSUED BY RBI UNDER CHAPTER IIIB OF THE RBI ACT 1934. THESE NORMS DEAL ESSENTIALLY WITH INCOME RECOGNITION. THEY FORCE THE NBFCS TO DISCLOSE THE AMOUNT OF NPA IN THEIR FINANCIAL ACCOUNTS. THEY FORCE THE NBFCS TO REFLECT TRUE AND CORRECT P ROFITS. BY VIRTUE OF SECTION 45Q AN OVERRIDING EFFECT IS GIVEN TO THE DIRECTIONS 1998 VIS - - VIS INCOME RECOGNITION PRINCIPLES IN THE COMPANIES ACT 1956. THESE DIRECTIONS CONSTITUTE A CODE BY ITSELF. HOWEVER THESE DIRECTIONS 1998 AND THE IT ACT OPERATE IN DIFFERENT AREAS. THESE DIRECTIONS 1998 HAVE NOTHING TO DO WITH COMPUTATION OF TAXABLE INCOME. THESE DIRECTIONS CANNOT OVERRULE THE PERMISSIBLE DEDUCTIONS OR THEIR EXCLUSION UNDER THE IT ACT. THE INCONSISTENCY BETWEEN THESE DIRECTIONS 9 ITA NO S. 2244 & 2245 /PN/2013 SAMARTH SAHAKARI BANK LTD. SOLAPUR AND COMPANIES ACT IS ONLY IN THE MATTER OF INCOME RECOGNITION AND PRESENTATION OF FINANCIAL STATEMENTS. THE ACCOUNTING POLICIES ADOPTED BY AN NBFC CANNOT DETERMINE THE TAXABLE INCOME. IT IS WELL SETTLED THAT THE ACCOUNTING POLICIES FOLLOWED BY A COMPANY CAN BE CHANGED U NLESS THE AO COMES TO THE CONCLUSION THAT SUCH CHANGE WOULD RESULT IN UNDERSTATEMENT OF PROFITS. HOWEVER HERE IS THE CASE WHERE THE AO HAS TO FOLLOW THE RESERVE BANK OF INDIA DIRECTIONS 1998 IN VIEW OF SECTION 45Q OF THE RESERVE BANK OF INDIA ACT. HENCE AS FAR AS INCOME RECOGNITION IS CONCERNED SECTION 145 OF THE IT ACT HAS NO ROLE TO PLAY IN THE PRESENT DISPUTE. 10. TURNING TO THE FACTS OF THE CASE BEFORE US THE ASSESSEE HEREIN IS A COOPERATIVE BANK AND IT IS NOT IN DISPUTE THAT IT IS ALSO GOVERNED B Y THE RESERVE BANK OF INDIA. HENCE THE DIRECTIONS WITH REGARD TO THE PRUDENTIAL NORMS ISSUED BY THE RESERVE BANK OF INDIA ARE EQUALLY APPLICABLE TO THE ASSESSEE AS IT IS APPLICABLE TO THE COMPANIES REGISTERED UNDER THE COMPANIES ACT. THE HON'BLE SUPREME CO URT HAS HELD IN THE CASE OF SOUTHERN TECHNOLOGIES LTD (SUPRA) THAT THE PROVISION OF 45Q OF RESERVE BANK OF INDIA ACT HAS AN OVERRIDING EFFECT VIS - - VIS INCOME RECOGNITION PRINCIPLE UNDER THE COMPANIES ACT. HENCE SEC.45 Q OF THE RBI ACT SHALL HAVE OVERRIDI NG EFFECT OVER THE INCOME RECOGNITION PRINCIPLE FOLLOWED BY COOPERATIVE BANKS ALSO. HENCE THE ASSESSING OFFICER HAS TO FOLLOW THE RESERVE BANK OF INDIA DIRECTIONS 1998 AS HELD BY THE HON'BLE SUPREME COURT. 10.1 BASED ON THE PRUDENTIAL NORMS THE ASSESSEE HEREIN DID NOT ADMIT THE INTEREST RELATABLE TO NPA ADVANCES IN ITS TOTAL INCOME. THE HON'BLE DELHI HIGH COURT IN THE CASE OF VASISTH CHAY VYAPAR LTD (SUPRA) HAS HELD THAT THE INTEREST ON NPA ASSETS CANNOT BE SAID TO HAVE ACCRUED TO THE ASSESSEE. IN THIS R EGARD THE FOLLOWING OBSERVATIONS OF HON'BLE DELHI HIGH COURT IN THE ABOVE CITED CASE ARE RELEVANT: WHAT TO TALK OF INTEREST EVEN THE PRINCIPLE AMOUNT ITSELF HAD BECOME DOUBTFUL TO RECOVER. IN THIS SCENARIO IT WAS LEGITIMATE MOVE TO INFER THAT INTEREST INCOME THEREUPON HAS NOT ACCRUED. 10 ITA NO S. 2244 & 2245 /PN/2013 SAMARTH SAHAKARI BANK LTD. SOLAPUR THE SAID DECISION OF THE HON'BLE DELHI HIGH COURT IS EQUALLY APPLICABLE TO THE ISSUE IN OUR HANDS. ACCORDINGLY WE DO NOT FIND ANY INFIRMITY WITH THE DECISION OF THE LEARNED CIT (A) IN HOLDING THAT THE INTEREST INCOME RE LATABLE ON NPA ADVANCES DID NOT ACCRUE TO THE ASSESSEE. ACCORDINGLY WE UPHOLD HIS ORDER. 10. FOLLOWING THE AFORESAID DISCUSSION WHICH HAS BEEN RENDERED ON AN IDENTICAL ISSUE UNDER SIMILAR CIRCUMSTANCES WE FIND NO REASONS TO INTERFERE WITH THE ULTIMATE CONCLUSION OF THE CIT(A) IN DELETING THE IMPUGNED ADDITION RELATING TO INTEREST INCOME IN RESPECT OF NPAS. 11. SO HOWEVER THE LEARNED DEPARTMENTAL REPRESENTATIVE HAS SUBMITTED THAT THE HONBLE MADRAS HIGH COURT IN THE CASE OF CIT VS. SAKTHI FINANCE LT D. (2013) 31 TAXMANN.COM 305 (MADRAS) HAS DIFFERED WITH THE JUDGEMENT OF THE HONBLE DELHI HIGH COURT IN THE CASE OF M/S VASISTH CHAY VYAPAR LTD. (SUPRA) ON A SIMILAR ISSUE I.E. RELATING TO INTEREST INCOME ON NPAS. THE LEARNED DEPARTMENTAL REPRESENTATIV E FURTHER POINTED OUT THAT THE HONBLE MADRAS HIGH COURT FOLLOWED THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF SOUTHERN TECHNOLOGIES LTD. (SUPRA) IN HOLDING THAT INTEREST ON NPAS WAS ASSESSABLE TO TAX ON ACCRUAL BASIS. WE HAVE CAREFULLY CONSID ERED THE SUBMISSIONS PUT - FORTH BY THE LEARNED DEPARTMENTAL REPRESENTATIVE BASED ON THE JUDGEMENT OF THE HONBLE MADRAS HIGH COURT IN THE CASE OF SAKTHI FINANCE LTD. (SUPRA). THE CONTROVERSY BEFORE THE HONBLE MADRAS HIGH COURT RELATED TO NON - RECOGNITION O F INTEREST INCOME ON NPAS BY THE ASSESSEE FOLLOWING THE RBI GUIDELINES. THE HONBLE MADRAS HIGH COURT TOOK THE VIEW THAT THE JUDGEMENT OF THE HONBLE SUPREME COURT IN THE CASE OF SOUTHERN TECHNOLOGIES LTD. (SUPRA) ALSO APPLIED TO THE INCOME RECOGNITION NO RMS PROVIDED BY RBI AND THEREFORE IT HELD THE INTEREST INCOME ON NPAS IS LIABLE TO BE TAXED ON ACCRUAL BASIS AND NOT IN TERMS OF RBIS GUIDELINES. BUT THE HONBLE DELHI HIGH COURT IN THE CASE OF M/S VASISTH CHAY VYAPAR LTD. (SUPRA) HAS TAKEN A VIEW THAT S OUTHERN TECHNOLOGIES LTD. (SUPRA) CASE DID NOT APPLY TO THE INCOME RECOGNITION NORMS PRESCRIBED BY RBI. OSTENSIBLY THERE IS DIVERGENCE OF OPINION BETWEEN THE HONBLE DELHI HIGH COURT AND THE HONBLE MADRAS HIGH COURT AS NOTED BY THE HONBLE MADRAS HIGH C OURT IN ITS ORDER. 11 ITA NO S. 2244 & 2245 /PN/2013 SAMARTH SAHAKARI BANK LTD. SOLAPUR 12. IN SO FAR AS PRESENT CASE IS CONCERNED THERE IS NO JUDGMENT OF THE JURISDICTIONAL HIGH COURT. WE ARE FACED WITH TWO CONTRARY JUDGMENTS OF THE NON - JURISDICTIONAL HIGH COURT. IN SUCH A SITUATION WE ARE INCLINED TO PREFER A VIEW WH ICH IS FAVOURABLE OF THE ASSESSEE FOLLOWING THE JUDGEMENT OF THE HONBLE SUPREME COURT IN THE CASE OF CIT VS. VEGETABLE PRODUCTS LTD. (1973) 88 ITR 192 (SC). 13. THEREFORE IN VIEW OF THE AFORESAID DISCUSSION WE ARE INCLINED TO FOLLOW THE DECISION OF O UR CO - ORDINATE BENCH IN THE CASE OF THE DURGA COOPERATIVE URBAN BANK LTD. (SUPRA) AND ACCORDINGLY THE ORDER OF THE CIT(A) IS LIABLE TO THE AFFIRMED. WE HOLD SO. 14. IN THE RESULT THE APPEAL OF THE REVENUE IS DISMISSED. 8. WE THEREFORE FOLLOWING TH E DECISION IN THE CASE OF THE OMERGA JANTA SAHAKARI BANK LTD. (SUPRA) DISMISS THE GROUNDS TAKEN BY THE REVENUE IN BOTH THE YEARS . 9. NOW WE DECIDE THE CROSS OBJECTION FILED BY THE ASSESSEE BEING CO NO. 93/PN/2014 PERTAINS TO THE A.Y. 2009 - 10. THE LD. C OUNSEL SUBMITS THAT THE SAID CROSS OBJECTION ONLY SUPPORT S THE ORDER OF THE LD. CIT(A) AND GROUND NO. 2 IN RESPECT OF THE LEVY OF INTEREST U/S. 234B IS TAKEN AS ABUNDANT PRECAUTION IN CASE THE REVENUE SUCCEEDS. AS THE CROSS OBJECTION IN THE A.Y. 2009 - 10 O NLY SUPPORT S THE ORDER OF THE LD. CIT(A) THE SAME IS INFRUCTUOUS AS NO SPECIFIC GRIEVANCE IS RAISED. ACCORDINGLY GROUNDS TAKEN BY THE ASSESSEE ARE DISMISSED. 10. SO FAR AS CO NO. 94/PN/2014 FOR THE A.Y. 2010 - 11 IS CONCERNED THE ASSESSEE HAS TAKEN THE F OLLOWING GROUNDS: 1. CROSS OBJECTOR PRAYS TO ALLOW THE DEDUCTION IN RESPECT OF PREMIUM ON HTM SECURITIES WRITTEN OFF IN PROFIT AND LOSS A/C. RS.2 09 423/ - . 2. CROSS OBJECTOR PRAYS FOR CONFIRMATION OF CIT(A)S DECISION IN DELETING ADDITION OF NPA INTEREST DISMI SSING APPEAL FILED BY THE DEPARTMENT. 12 ITA NO S. 2244 & 2245 /PN/2013 SAMARTH SAHAKARI BANK LTD. SOLAPUR 3. CROSS OBJECTOR PRAYS FOR CANCELLATION OF LEVY OF INTEREST U/S. 234B IF FOR ANY REASON THE DEPARTMENTS APPEAL ON INTEREST ON NPA ADDITION IS CONFIRMED AS EVEN THEN THE INCOME ESTIMATED BY BANK FOR PAYMENT OF ADVANCE TAX CANNOT BE SAID TO BE WRONG. 11. SO FAR AS GROUND NO . 2 IS CONCERNED IT ONLY SUPPORT S THE ORDER OF THE LD. CIT(A) AND GROUND NO. 3 IS TAKEN AS ABUNDANT PRECAUTION IN CASE THE REVENUE SUCCEEDS. BOTH THE GROUNDS BECOME INFRUCTUOUS. ACCORDINGLY GROUND S NOS. 2 & 3 ARE DISMISSED. 12. SO FAR AS GROUND NO. 1 IS CONCERNED THE ISSUE IS IN RESPECT OF PREMIUM ON HTM SECURITIES WRITTEN OFF IN PROFIT AND LOSS A/C. THE FACTS WHICH ARE EMERGING FROM THE RECORD S AS UNDER. THE ASSESSEE BANK HAS DEBITED A SUM OF RS.2 09 423/ - UNDER THE HEAD OF PREMIUM ON HTM SECURITIES. THE ASSESSING OFFICER HAS RESERVATION FOR ALLOWING THE CLAIM OF THE ASSESSEE AS IN HIS OPINION THE SECURITIES ON WHICH THE PREMIUM WAS PAID ARE HELD UNDER THE CATEGORY OF HTM (HELD TO MATURITY) AN D THOSE SECURITIES ARE IN THE NATURE OF THE CAPITAL ASSETS AND THE PREMIUM PAID FORMS THE INTEGRAL PART OF THE COST OF THE CAPITAL ASSET AND SAME CANNOT BE SEGREGATED FROM THE COST OF SECURITIES AND CLAIMED AS DEDUCTION. THE ASSESSING OFFICER DISALLOWED T HE CLAIM OF THE ASSESSEE IN RESPECT OF THE AMORTIZATION OF PREMIUM ON THE SECURITIES HELD UNDER THE CATEGORY OF HTM. THE LD. CIT(A) ALSO CONFIRMED THE ACTION OF THE ASSESSING OFFICER. NOW THE ASSESSEE HAS RAISED GRIEVANCE IN HIS CROSS OBJECTION. 13. WE HAVE HEARD THE PARTIES. THE LD. COUNSEL SUBMITS THAT THE ISSUE STANDS COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE ITAT PUNE IN THE CASE OF LATUR URBAN CO - OP. BANK LIMITED VS. DCIT CIRCLE - 3 NANDED BEING ITA NOS. 778 & 792/PN/2011 ORDER D ATED 31 - 08 - 2012. THE OPERATIVE PART OF THE TRIBUNAL IS AS UNDER: 13 ITA NO S. 2244 & 2245 /PN/2013 SAMARTH SAHAKARI BANK LTD. SOLAPUR 13. SO FAR AS GROUND NO. 2 IS CONCERNED IT IS IN RESPECT OF THE DISALLOWANCES ON THE LOSS ON SALE OF SURPLUS OF RS. 14 70 000/ - . THE A.O HAS OBSERVED THAT AN AMOUNT OF RS. 14 70 000/ - IS D EBITED TO THE PROFIT & LOSS A/C ON ACCOUNT OF LOSS ON SALE OF SECURITIES. THE A.O HAS FURTHER OBSERVED THAT THE ASSESSEE IN ITS SUBMISSION HAS STATED THAT SECURITIES OF THE BANK ARE HELD UNDER THE HEAD TO MATURITY CATEGORY AND THEREFORE LOSS ARISIN G ON THE SALE OF INVESTMENT IS IN THE NATURE OF CAPITAL LOSS AND THEREFORE THE SAME IS NOT ALLOWABLE EXPENDITURE. THE A.O MADE THE ADDITION TO THE EXTENT OF RS. 14 70 000/ - . THE LD CIT(A) CONFIRMED THE ADDITION. 14. WE HAVE HEARD THE PARTIES. THE LD C OUNSEL PLACED HIS HEAVY RELIANCE ON THE DECISION OF THE HONBLE HIGH COURT OF BOMBAY IN THE CASE OF CIT VS. BANK OF BARODA AND IN THE CASE OF UCO BANK VS. CIT 240 ITR 355 (SC). IN THE CASE OF BANK OF BARODA (SUPRA) THE ISSUE BEFORE THEIR LORDSHIP WAS WH ETHER THE ASSESSEE WAS ENTITLED FOR DEDUCTION ON ACCOUNT OF DEPRECIATION IN THE VALUE OF INVESTMENTS. THE METHOD OF VALUATION FOLLOWED BY THE ASSESSEE BANK WAS TO VALUE INVESTMENTS AT COST OR MARKET VALUE WHICHEVER WAS LOWER. THE ASSESSEE HAD CLAIMED THE DEPRECIATION TO THE TUNE OF RS. 11 82 35 007/ - AND THE SAID DEPRECIATION WAS CLAIMED AS A DEDUCTION WHICH WAS DISALLOWED BY THE A.O BUT THE ASSESSEE BANK SUCCEEDED BEFORE THE CIT(A). THE TRIBUNAL CONFIRMED THE ORDER OF THE CIT(A). THE REVENUE CARRIED T HE ISSUE BEFORE THE HONBLE HIGH COURT. THE CORE ISSUE WAS THE METHOD OF VALUATION ADOPTED BY THE ASSESSEE BANK FOR VALUING THE STOCK OF THE SECURITIES. THE HONBLE HIGH COURT FOLLOWED THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF UNITED COMMERCI AL BANK (SUPRA). 15. IN THE CASE OF UNITED COMMERCIAL BANK (SUPRA) EVEN THE ISSUE OF VALUATION OF THE STOCK IN TRADE OF THE INVESTMENT WAS BEFORE THE HONBLE SUPREME COURT. IN THE CASE OF THE ASSESSEE THE ISSUE IS REGARDING ALLOWABILITY OF THE LOSS ON THE SALE OF THE SECURITIES. MERELY BECAUSE THE SECURITIES ARE KEPT UNDER THE HEAD TILL THE MATURITY THE SAID SECURITY CANNOT BE TREATED AS A PURELY INVESTMENT. LAW IS WELL SETTLED THAT THE SECURITIES HELD BY THE BANK ARE IN THE NATURE OF STOCK - IN - TRAD E. WE MAY LIKE TO QUOTE HERE THE DECISION OF THE HONBLE HIGH COURT OF KERALA IN THE CASE OF CIT VS. NEDUNGADI BANK LTD. 264 ITR 545. IN THE SAID CASE THE 14 ITA NO S. 2244 & 2245 /PN/2013 SAMARTH SAHAKARI BANK LTD. SOLAPUR HONBLE HIGH COURT HAS HELD THAT THE SECURITIES HELD BY THE BANK ARE IN THE NATURE OF STOCK - IN - TR ADE. BOTH THE AUTHORITIES BELOW HAS MERELY GONE ON THE NOMENCLATURE OF THE HEAD UNDER WHICH THE SECURITIES ARE HELD. IN OUR CONSIDERED VIEW NOMENCLATURE CANNOT BE DECISIVE FOR THE ASSESSEE BANK. WE THEREFORE HOLD THAT THE LOSS ON THE SALE OF THE SECUR ITIES IS REVENUE IN NATURE AND SAME IS ALLOWABLE. ACCORDINGLY GROUND NO. 2 IS ALLOWED. 14. WE FIND THAT THE IDENTICAL ISSUE HAS COME BEFORE THE TRIBUNAL IN THE CASE OF ACIT CIRCLE - 4 PUNE VS. PUNE PEOPLES CO - OP. BANK LTD. PUNE BEING ITA NO. 1847/PN /2012 ORDER DATED 31 - 10 - 2013. THE OPERATIVE PART OF THE TRIBUNAL IS AS UNDER: 3. WE FIND THAT IDENTICAL CLAIM WAS MADE BY THE ASSESSEE IN THE A.Y. 2008 - 09 WHICH WAS DISALLOWED BY THE ASSESSING OFFICER AND ALLOWED BY THE CIT(A). THE MATTER WAS TRAVELLED T O THIS TRIBUNAL BY WAY OF APPEAL BEING ITA NO. 1413/PN/2011 VIDE ORDER DATED 08 - 08 - 2013 THE TRIBUNAL HAS CONFIRMED THE ORDER OF THE LD. CIT(A). WE THEREFORE FOLLOWING THE DECISION OF THIS TRIBUNAL IN ASSESSEES OWN CASE UPHOLD THE ORDER OF THE CIT(A). WE ALSO FIND THAT THIS ISSUE ALSO STANDS COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISIONS OF THIS TRIBUNAL IN THE CASES OF THE RATNAKAR BANK LTD. KOLHAPUR VS. ACIT BEING ITA NO. 789/PN/2010 ORDER DATED 08 - 02 - 2013 AS WELL AS LATUR URBAN CO - OPERATIVE BAN K LTD. LATUR VS. DCIT NANDED BEING ITA NOS. 778 & 792/PN/2011 ORDER DATED 31 - 08 - 2012. THE OPERATIVE PART OF THE FINDING OF THE TRIBUNAL IN THE CASE OF LATUR URBAN CO - OPERATIVE BANK LTD. (SUPRA) AND HAS HELD AS UNDER: 15. IN THE CASE OF UNITED COMME RCIAL BANK (SUPRA) EVEN THE ISSUE OF VALUATION OF THE STOCK IN TRADE OF THE INVESTMENT WAS BEFORE THE HONBLE SUPREME COURT. IN THE CASE OF THE ASSESSEE THE ISSUE IS REGARDING ALLOWABILITY OF THE LOSS ON THE SALE OF THE SECURITIES. MERELY BECAUSE THE S ECURITIES ARE KEPT UNDER THE HEAD TILL THE MATURITY THE SAID SECURITY CANNOT BE TREATED AS A PURELY INVESTMENT. LAW IS WELL SETTLED THAT THE SECURITIES HELD BY THE BANK ARE IN THE NATURE OF STOCK - IN - TRADE. WE MAY LIKE TO QUOTE HERE THE DECISION OF THE HONBLE HIGH COURT OF KERALA IN THE CASE OF CIT VS. NEDUNGADI BANK LTD. 264 ITR 545. IN THE SAID CASE THE HONBLE HIGH COURT HAS HELD THAT THE SECURITIES HELD BY THE BANK ARE IN THE NATURE 15 ITA NO S. 2244 & 2245 /PN/2013 SAMARTH SAHAKARI BANK LTD. SOLAPUR OF STOCK - IN - TRADE. BOTH THE AUTHORITIES BELOW HAS MERELY GONE O N THE NOMENCLATURE OF THE HEAD UNDER WHICH THE SECURITIES ARE HELD. IN OUR CONSIDERED VIEW NOMENCLATURE CANNOT BE DECISIVE FOR THE ASSESSEE BANK. WE THEREFORE HOLD THAT THE LOSS ON THE SALE OF THE SECURITIES IS REVENUE IN NATURE AND SAME IS ALLOWABLE. ACCORDINGLY GROUND NO. 2 IS ALLOWED. 15. WE THEREFORE ALLOW THE GROUND NO. 1 TAKEN BY THE ASSESSEE IN THE CROSS OBJECTION AND DELETE THE ADDITION. 16. IN THE RESULT BOTH THE APPEALS OF THE REVENUE ARE DISMISSED AND CROSS OBJECTION FOR THE A.Y. 2009 - 10 IS DISMISSED AND CROSS OBJECTION FOR THE A.Y. 2010 - 11 IS PARTLY ALLOWED. PRONOUNCED IN THE OPEN COURT ON 26 - 11 - 201 4 SD/ - SD/ - ( R.K. PANDA ) ( R.S. PADVEKAR ) ACCOUNTANT MEMBER JUDICIAL MEMBER PUN E DATED : 26 TH NOVEMBER 201 4 RK/PS COPY TO 1 ASSESSEE 2 DEPARTMENT 3 THE CIT(A) - III PUNE 4 THE CIT - IV PUNE 5 6 THE DR ITAT A BENCH PUNE. GUARD FILE. //TRUE COPY// BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRI BUNAL PUNE