South Malabar Gramina Bank, Malappuram v. ACIT, Malappuram

ITA 251/COCH/2013 | 2008-2009
Pronouncement Date: 31-07-2013 | Result: Allowed

Appeal Details

RSA Number 25121914 RSA 2013
Assessee PAN AARFS5208D
Bench Cochin
Appeal Number ITA 251/COCH/2013
Duration Of Justice 2 month(s) 25 day(s)
Appellant South Malabar Gramina Bank, Malappuram
Respondent ACIT, Malappuram
Appeal Type Income Tax Appeal
Pronouncement Date 31-07-2013
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted DB
Tribunal Order Date 31-07-2013
Date Of Final Hearing 15-07-2013
Next Hearing Date 15-07-2013
Assessment Year 2008-2009
Appeal Filed On 06-05-2013
Judgment Text
1 ITA NO. 251/COCH/2013 IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH COCHIN BEFORE SHRI N.R.S. GANESAN (JM) AND SHRI B.R. BASKA RAN(AM) I.T.A NO. 251/COCH/2013 (ASSESSMENT YEAR 2008-09) SOUTH MALABAR GRAMIN BANK VS A.C.I.T. CIR.2 SMGB TOWER A.K. ROAD MALAPPURAM MALAPPURAM 676 505 PAN : AARFS5208D (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SURAJ KUMAR B RESPONDENT BY : SMT. S VIJAYAPRABHA DATE OF HEARING : 15-07-2013 DATE OF PRONOUNCEMENT : 31-07-2013 O R D E R PER N.R.S. GANESAN (JM) THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF CIT(A) KOZHIKODE DATED 06-02-2013 FOR THE ASSESSMENT YEAR 2008-09. 2. THE ONLY ISSUE ARISES FOR CONSIDERATION IS AMORT IZATION OF PREMIUM PAID ON PURCHASE OF GOVERNMENT SECURITIES. 3. SHRI SURAJ KUMAR B THE LD.REPRESENTATIVE FOR TH E ASSESSEE SUBMITTED THAT THIS TRIBUNAL HAD AN OCCASION TO CONSIDER AN I DENTICAL ISSUE IN CATHOLIC 2 ITA NO. 251/COCH/2013 SYRIAN BANK LTD (2010) 38 SOT 553 (COCH) AND FOLLOW ING ITS EARLIER ORDER FOUND THAT THE AMORTIZATION OF PREMIUM ON PURCHASE OF GOVERNMENT SECURITIES HAS TO BE ALLOWED WHILE COMPUTING THE TO TAL INCOME. THEREFORE ACCORDING TO THE LD.REPRESENTATIVE THIS ISSUE IS C OVERED IN FAVOUR OF THE ASSESSEE. 4. WE HEARD SMT. S VIJAYAPRABHA THE LD.DR ALSO. A CCORDING TO THE LD.DR THE PREMIUM PAID BY THE ASSESSEE FOR PURCHAS ING GOVERNMENT SECURITIES ARE PART OF THE COST OF ACQUISITION OF T HE GOVERNMENT SECURITIES THEREFORE IT IS A CAPITAL EXPENDITURE. IF THE AMO UNT RECEIVED IS LESS THAN THE COST AT THE TIME OF REDEMPTION OF THE SECURITIE S THEN AT THE BEST THE ASSESSEE MAY CLAIM CAPITAL LOSS. WHAT CAN BE ALLOW ED AS REVENUE EXPENDITURE IS AN EXPENDITURE MADE FOR MAINTENANCE AND REPAIR OF CAPITAL ASSET OR AT THE BEST FOR EARNING ANY PARTICULAR INC OME. SINCE IT IS A COST OF CAPITAL ASSET ACCORDING TO THE LD.DR IT CANNOT BE ALLOWED AS REVENUE EXPENDITURE. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. AS RIGHT LY SUBMITTED BY THE LD.REPRESENTATIVE FOR THE ASSESSEE THIS TRIBUNAL IN THE CASE OF CATHOLIC SYRIAN BANK LTD (SUPRA) CONSIDERED THIS ISSUE BY FO LLOWING ITS EARLIER ORDER. THE TRIBUNAL FOUND THAT AMORTIZATION OF PREMIUM FOR PURCHASE OF 3 ITA NO. 251/COCH/2013 GOVERNMENT SECURITIES HAS TO BE ALLOWED AS REVENUE EXPENDITURE. SINCE A CO-ORDINATE BENCH OF THIS TRIBUNAL HAS ALREADY DECI DED THE ISSUE IN FAVOUR OF THE ASSESSEE THIS TRIBUNAL DO NOT FIND ANY REAS ON TO TAKE A DIFFERENT VIEW. THEREFORE BY FOLLOWING THE ORDER OF THIS TR IBUNAL IN THE CASE OF CATHOLIC SYRIAN BANK LTD (SUPRA) FOR THE REASONS ST ATED THEREIN THE ORDER OF THE LOWER AUTHORITIES ARE SET ASIDE AND THE ASSE SSING OFFICER IS DIRECTED TO ALLOW AMORTIZATION OF THE PREMIUM PAID ON PURCHA SE OF GOVERNMENT SECURITIES AS REVENUE EXPENDITURE. 6. IN THE RESULT APPEAL OF THE ASSESSEE STANDS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 31 ST JULY 2013. SD/- SD/- (B.R. BASKARAN) (N.R.S. GANESAN) ACCOUNTANT MEMBER JUDICIAL MEMBER COCHIN DT : 31 ST JULY 2013 PK/- COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE COMMISSIONER OF INCOME-TAX 4. THE COMMISSIONER OF INCOME-TAX(A) 5. THE DR (TRUE COPY) BY ORDER ASSTT. REGISTRAR INCOME-TAX APPELLATE TRIBUNAL COCHIN BENCH