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of <h1>ITAT allows part of appeal for Cooperative bank, remits matter for reconsideration on fund contributions</h1> <h3>The Karnataka State Co-operative Apex Bank Ltd. Versus The Jt. Commissioner of Income-tax</h3> The ITAT allowed the appeal in part for an Apex Cooperative bank, permitting the expenditure claimed towards the Co-operative Education Fund but remitted ... - Issues involved: Disallowance of expenditure claimed by the assessee u/s 143(3) of the Income-tax Act, 1961.Summary:Issue 1: Disallowance of ExpenditureThe assessee, an Apex Cooperative bank, claimed expenditure towards various funds created from surplus profits. The AO disallowed the expenditure, stating that the contributions to funds were not wholly and exclusively for the banking business, as per the bank's Bye-laws. The CIT(A) upheld the disallowance, considering the contributions as capital in nature. The assessee appealed, arguing that contributions were statutory obligations covered by relevant case law. The ITAT held that the contribution to the Co-operative Education Fund was justified, following the jurisdictional High Court's decision. For other contributions, the matter was remitted to the CIT(A) for further consideration, as the CIT(A) failed to address the assessee's contentions.This judgment dealt with the disallowance of expenditure claimed by an Apex Cooperative bank for various funds created from surplus profits. The AO disallowed the expenditure, stating that the contributions were not wholly and exclusively for the banking business as per the bank's Bye-laws. The CIT(A) upheld the disallowance, considering the contributions as capital in nature. The ITAT allowed the appeal for the contribution to the Co-operative Education Fund based on relevant case law. However, for other contributions, the ITAT remitted the issue back to the CIT(A) for reconsideration, as the CIT(A) did not address the assessee's contentions adequately.
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