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TMI Blog2019 (12) TMI 915X X X X Extracts X X X X X X X X Extracts X X X X ..... 51/2017- 18/AC,C-1(1),VSP/2018-19 dated 29.01.2019 for the Assessment Year (A.Y.) 2014-15 and 2015-16. Cross objections are filed by the assessee in support of the order of the Ld.CIT(A). For the sake of convenience, these appeals are clubbed, heard together and a common order is being passed as under: 3. Facts are extracted from the appeal of the assessee for the A.Y.2014- 15 and identical to A.Y.2015-16 also. The first issue is related to the disallowance of interest on fixed deposits of the members of the cooperative society amounting to Rs. 3,94,12,695/- representing the interest on deposits paid to the members of the Cooperative Society u/s 40(a)(ia) of the Income Tax Act, 1961 (in short 'Act'). 4. The assessee is a cooperative bank, filed its return of income for the A.Y.2014-15 on 29.11.2014 admitting total income of Rs. 85,98,940/-. The case of the assessee was taken up for scrutiny by issue of notice u/s 143(2) on 28.08.2015 and the assessment was completed u/s 143(3) of the Act vide order dated 27.12.2016 and the total income was assessed at Rs. 4,80,34,850/-. The Assessing Officer(AO) made two additions. The first addition was in respect of disallowance of interest u/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laim of the assessee. The Ld. CIT(A) initially confirmed the order of the A.O. Subsequently, the assessee has filed a rectification u/s 154 of the Act dated 14.12.2013 and submitted that the very same issue has been considered by the CIT(A) as well as ITAT for earlier years and decided in favour of the assessee. The Ld. CIT(A) has considered the submissions of the assessee and directed the A.O. to delete the addition by observing as under: 5.2. I have considered the submissions. The issue considered in the above appellate order was whether the assessee, a cooperative bank is required to effect TDS on payment of interest made to its members, when the amounts exceed Rs. 10,000/-. A view was taken that in the above order dtd.22.10.2013 that if the interest amount exceeds Rs. 10,000/- then the appellant is required to deduct TDS even if the payment was made to the members. Such a view was taken with reference to provision contained in section 194A(3)(i)(b) and it was held that section 194A(3)(i)(b) would prevail over section 194A(3)(v) of the Act. Such a view was taken without considering the clarification given in the CBDT circular No.9 of 2002 dtd.11.09.2002. The relevant clarifica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f which submitted as part of paper-book in the original appeal). Therefore, it cannot be said that this aspect was not considered by the Hon'ble ITAT while passing order in the assessee's appeal for A.Y.2007-08. 5.4 In view of the above discussion, I am convinced that the appellate order dtd.22.10.2013 suffers from mistake apparent from record and the mistake is rectified by substituting the following operative para in the place of the para 6.3, 6.4 & 6.5 of the appellate order dtd.22.10.2013. 6.3 I have considered the submissions made. In view of the clarification given in the CBDT circular No.9/2002, it is held that the assessee is not required to effect TDS on the interest payment made to its members even if it exceeds Rs. 10,000/-. The impugned disallowance made in the assessment is not in accordance with the clarification given in the CBDT Circular No.9/2002 and accordingly the AO is directed to delete the impugned disallowance made of Rs. 5,64,79,087/-. This ground of appeal is allowed in favour of the appellant. 5.5. The appellate order dtd.22.10.2013 in ITA No.0297/12-13 be considered to be modified and rectified accordingly with reference to ground No.3 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cord. The issue on identical facts has come before this Bench for the assessment year 2011-12 and 2012-13 in the case of Visakhapatnam Cooperative Bank Ltd. in ITA No.362 and 371 dated 31.12.2016. For the sake of clarity and convenience, we extract para No.67 of the order of this Tribunal which reads as under : "67. The very similar issue came up for consideration before the ITAT in the Assessment Year 2008-09 in ITA No.444/Vizag/2012, order dated 30.09.2016. The Tribunal has considered and remitted the matter back to the file of the Assessing Officer for fresh examination to decide in accordance with law. We find in the Assessment Year 2008-09, amortization of premium on government securities has been dissolved by the Assessing Officer on the ground that it is a contingent liability. The Commissioner of Income Tax (Appeals) has confirmed the order the of Assessing Officer. On appeal, ITAT remanded the matter back to the Assessing Officer for fresh consideration. In the year under consideration, the Commissioner of Income Tax (Appeals) allowed the ground raised by the assessee by following the CBDT Instruction No.17/2008 dated 26.09.2008 and also the decision of the Hon'ble Guj ..... X X X X Extracts X X X X X X X X Extracts X X X X
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