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2018 (2) TMI 876 - HC - Income TaxTDS u/s 194(A)(1) - non deuction of tds on interest payments exceeding ₹ 10,000/- - provisions under Section 40(a)(ia) invoked - assessee contended that the co-operative bank was not required to deduct tax at source from the payment of interest on time deposits of its members paid or credited before 01.06.2015 - Held that:- There has not been due application of mind to the stand taken by the petitioner in their reply dated 04.12.2017. The respondent has proceeded entirely on a different ground than what was mentioned in the show cause notice. The decision arrived at while completing the assessment is not on the ground on which the petitioner was required to show cause. This would be sufficient to set aside the impugned proceedings. That apart, the respondent has passed the impugned order by drawing a distinction between different types of Cooperative Societies and has stated that the petitioner is involved in banking business though it is a cooperative society and tax has to be deducted at source. In fact, this very issue was considered in M/s The Coimbatore District Central Co-operative Bank case [2016 (1) TMI 370 - MADRAS HIGH COURT] . Respondent has not gone through the decision, copy of which was filed by the petitioner along with their reply to the show cause notice. The Assessing Officer was bound by the decision rendered by the jurisdictional High Court. It is stated that as on date there is no appeal by the revenue as against the decision in the case of Coimbatore District Central Cooperative Bank Ltd. That apart, in the assessee's own case for the previous assessment years, the Tribunal has held in favour of the petitioner assessee. Thus the impugned order calls for interference. Accordingly, the writ petition is allowed, the impugned order is set aside and the matter is remanded to the respondent for passing fresh orders
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