TaxTMI 
TaxTMI 
2014 (2) TMI 137
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.... to the above said issue are stated in brief. The assessee claimed deduction towards provision for bad and doubtful advances u/s 36(1)(viia) of the Act at 7.5% of the Gross total income amounting to Rs.15,07,971/- and further deduction of Rs.4,76,02,710/- being 10% of the aggregate advances made by the rural branches. The AO disallowed the claim of Rs.4,76,02,710/- on the ground that the assessee bank does not have any rural branch, i.e., the location of the branches of the bank are not "rural". The assessee filed appeal before Ld CIT(A) on this issue, but could not succeed. Hence, the assessee is in appeal before us. I.T.A. No. 08/Coch/2011 3. The Ld Counsel for the assessee submitted that the Income tax Act has defined the term "rur....
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....bsp; "6. With regard to the interpretation of the word "Place" for the purpose of ascertaining rural branches, it was submitted by Ld D.R that the orders passed by the ITAT, which were relied upon by the Ld CIT(A), have since been reversed by the Hon'ble Kerala High Court. The Ld D.R also placed before us the order dated 07-10-2010 passed by Hon'ble Kerala High Court in ITA No.234 of 2009 in the case of CIT Vs. The Lord Krishna Bank Ltd, which is reported in 195 Taxman 57. I.T.A. No. 08/Coch/2011 The relevant observations made by the Hon'ble Jurisdictional Kerala High Court are extracted below, for the sake of convenience:- "In our view, the definition clause does not exclude the literal meaning of rural branch which....
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....lity or Panchayats. There can be no Village in a Municipal or Corporation area where the population is less than 10000. So much so, rural Branches are such of the Branches located in a Village where the population in the Village as a unit is less than 10000. We, therefore, allow the appeal on this issue by reversing the order of the Tribunal and by restoring the assessment." By respectfully following the decision of Jurisdictional High Court, we set aside the order of Ld CIT(A) on this issue and restore that of the assessing officer. 7. Before us, the Ld A.R took an alternative plea with regard to the issue of determination of "rural branch" by submitting that the definition of "rural branch" given in sec. 36(1)(viia) shall not apply ....
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....pra also does not apply to the assessee herein, since it is a co-operative Bank. Accordingly it is prayed that the matter requires re-examination at the end of AO. 7.2 We notice that the Ld A.R has taken this alternative plea, which is entirely a new one that too raised for the first time, without filing an additional ground along with a petition praying for its admission. This plea has not also been raised before the lower authorities. Hence, the alternative ground should not have been accepted normally. However, since the alternative plea of the assessee involves interpretation of the various provisions/clauses of the Act/other Central Act only, in the interest of natural justice, we proceed to address the alternative plea of the asses....
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....eanings respectively assigned to them in Part V of the Banking Regulation Act, 1949 (10 of 1949)". 8.1 Since the definition of "non-scheduled bank" and "Co-operative Bank" refer to the Banking Regulation Act, 1949, we have to refer the said Central Act in I.T.A. No. 08/Coch/2011 order to understand their respective meaning. We have also gone through the said Act. For understanding the meaning of "non-scheduled bank" we have to refer to clause (c) of section 5 of the Banking Regulation Act, 1949, which reads as under:- Sec. 5(c): "banking company" means any company which transacts the business of banking in India. For understanding the meaning of "Co-operative Bank" we have to refer to Part V of the Banking Regulations Act, 19....