2019 (2) TMI 238

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.... 2. The Appeal is filed by the Revenue to challenge the judgment of Income Tax Appellate Tribunal (for short "the Tribunal"). The following question was pressed before us at the time of arguments:   " Whether the Tribunal erred in law in failing to appreciate the fact that the assessee is a cooperative bank and not a scheduled bank and that the provisions of section 43D are applicable to the financial institutions and not to cooperative societies?" 3. Respondent-Assessee is a Cooperative Bank. The Bank had filed return of income for the Assessment Year 200910 on 31st March, 2011, declaring loss of Rs. 34.11 Crores (rounded of). During the assessment of the return, the Assessing Officer noticed that the Assessee-Bank had transferred ....

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....he Tribunal by the impugned judgment reversed the decisions of the Revenue Authorities. The Tribunal relied on its earlier decision in case of this very assessee for earlier Assessment Years, in which, the issue was discussed at length. The Tribunal broadly relied upon the principle of real income theory and referred to the decision of the Supreme Court in case of CIT v/s. Shoorji Vallabahdas & Co., reported in 46 ITR 144. Thereupon, the Revenue has preferred this appeal. 5. Having heard the learned Counsel for the parties, we notice that the issue is squarely covered by the judgments of Gujarat High Court and Punjab & Haryana High Courts. The Gujarat High Court in case of Pr. CIT v/s. Shri Mahila Sewa Sahakari Bank Ltd., reported in 395 I....

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....NPA in favour of the assessee as being taxable in the year of receipt. The Tribunal had upheld the deletion made by the CIT(A) on account of addition of Rs. 3,02,82,000 regarding interest accrued on NPA. No illegality or perversity could be demonstrated by learned counsel for the Revenue in the aforesaid findings recorded by the Tribunal." 7. The issue is thus, covered by the decisions of two High Courts as noted above wherein identical situation came up for consideration. Against the judgment of the Gujarat High Court, the appeals have been dismissed by the Supreme Court. Thus, the Supreme Court can be seen to have approved the decision of the Gujarat High Court in case of Shri Mahila Sewa Sahakari Bank Ltd., (supra). We, therefore, do no....

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....ons or banks or corporations or companies, shall be chargeable to tax in the previous year in which it is credited to its profit and loss account for that year or actually received, whichever is earlier. This provision is an exception to the accrual system of accounting which is regularly followed by such assessee for computation of total income. The benefit of this provision is presently available to scheduled banks, public financial institutions, state financial corporations, State industrial investment corporations and certain public companies like Housing Finance companies. With a view to provide a level playing filed to cooperative banks vis-a-vis scheduled banks and to rationalize the scope of section 43D, it is proposed to amend sec....