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Almora Urban Co-Operative Bank Ltd Versus Income Tax Officer (Tds) , Kashipur

2015 (8) TMI 13 - ITAT DELHI

TDS liability on term deposits - assessee is a Co-operative society engaged in Co-operative business of banking which was registered under Uttarakhand Sahkari Samiti Adhiniyam 2003 - Held that:- As far as the applicability of the relevant provision is considered, the Co-ordinate Bench in the case of Kashipur Urban Co-operative Bank Limited vs. ITO [2015 (7) TMI 760 - ITAT DELHI] relying upon the decision rendered in ACIT vs Visakhapatnam Cooperative Bank Ltd. (2011 (8) TMI 319 - ITAT VISAKHAPATN .....

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file of the AO for this limited purpose - Decided in favour of assessee for statistical purposes. - ITA No. 5324/Del/2013 - Dated:- 10-6-2015 - Diva Singh, JM And J S Reddy, AM,JJ. For the Appellant : Shri K R Rastogi, CA For the Respondent : Ms Y Kakkar, DR ORDER Per Diva Singh,JM. By the present appeal, the assessee assails the correctness of the order of CIT(A)-II, Dehradun dated 29.07.2013 pertaining to 2012-13 assessment year contending that in the facts of the present case there was no ob .....

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tion was called forth. In response thereto the assessee is found to have stated that it was a Co-operative society engaged in Co-operative business of banking which was registered under Uttarakhand Sahkari Samiti Adhiniyam 2003. It was submitted that Section 2(19) of I.T. Act defines Co-operative society registered as a Co-operative society registered under the Co-operative Societies Act, 1912 (2) of 1912, or under any other law for the time being in force in any state for the registration of Co .....

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exemption from tax deducted at source to such income credited or paid by a co-operative society to a member thereof or to any other co-operative society. Thus it was submitted that as per the provisions of section 194A(3)(v) of the I.T. Act the provisions relating to tax deducted at source are inapplicable to the income credited or paid by the cooperative societies to the member thereof. In the present case every depositor it was submitted is a member of the Almora Urban Co-operative Bank Limite .....

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as upheld by the CIT(A). 4. Aggrieved by this the assessee is in appeal before the Tribunal. The ld. AR appearing on behalf of the assessee re-iterated the submissions before the authorities below. Apart from relying on various other orders of the Tribunal referred to in the Paper Book, reliance was also placed on the order dated 14.11.2014 of Pune Bench of the Tribunal in an identically situated case of Cooperative Bank namely Kashipur Urban Cooperative Bank Ltd. vs ITO passed by the Delhi Benc .....

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ITA No.-85/PN/2013 in the case of Bailhongal Urban Co-op. Bank Ltd. vs JCIT wherein Panaji Bench vide its order dated 28.08.2013 which has been referred to and followed by the Banglore Bench of the Tribunal in Bagalkot District General Co-operative Bank vs JCIT (cited supra). Accordingly relying on the orders of Kashipur Urban Co-operative Bank Ltd., vs Income Tax Officer, ITA No.-5329/Del/2013; Bagalkot District General Co-operative Bank vs JCIT, Bijapur, Range-Bijapur [2014] 48 Taxman.com 117 .....

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Act in 2015, the issue has been addressed by way of retrospective amendment. 5. The Ld. Sr. DR relying upon the impugned order and the decision of the ITAT SMC Bench in the case of Bhagani Nivedita Sah.Bank Ltd. (cited supra) submitted that in the case of the present case, it may need to be seen whether the members of the Co-operative Banks were the primary members or the secondary members. 6. We have heard the rival submissions and perused the material available on record. On a consideration t .....

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Co-ordinate Bench is reproduced hereunder:- "We have carefully considered the arguments of the assessee and also the decision rendered by ld. CIT(A). Section 194A(3) of the Act prescribes the monetary limits and also a list of payments which are exempt from the requirement of complying with the provisions of TDS prescribed under sub-section (1) of that section. Clause (v) of section 194A(3), on which reliance was placed by the assessee, reads as under: "To such income credited or paid .....

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e being in force in any state for the registration of cooperative societies." It can be seen that neither sec. 2(19) nor sec. 194A(3) makes any discrimination between the cooperative societies carrying on banking business and other cooperative societies. However, as per sec. 194A(3), the said exemption is available only to the interest payments made to its members or to any other cooperative society. In the instant case, it is the claim of the assessee that all the interest payments have be .....

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n into consideration. For ready-reference, we extract the relevant portion for the said order which would address the objection of the AO also which have been upheld by the CIT(A) and relied upon by the Ld. Sr. DR:- 19. "In the case decided by ITAT Panaji Bench in ITA NO.85/PN/2013 for AY 09-10 in the case of the Bailhongal Uraban Co-op Bank Ltd. (supra) order dated 28.8.2013, the tribunal proceeded on the footing that the aforesaid circular has been quashed by the Hon'ble Bombay High C .....

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A(3)(v) of the Act. It is only that part of the circular that had been quashed by the Hon'ble Bombay High Court and the other paragraphs of the Circular had no connection with the issue before the Hon'ble Bombay High Court. How could it be said that the entire circular has been quashed by the Hon'ble Bombay High Court? In our view para-2 of the Circular still holds good and the conclusion of the ITAT Pune Bench in the case of the Bailhongal Uraban Co-op Bank Ltd. (supra) are not fact .....

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