2021 (2) TMI 134

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....ers because the issue in this matter is not common with the issue involved in the connected matters. Accordingly, we have detagged this matter from the connected matters. 3. This appeal was admitted on 26th February, 2018 on four substantial questions of law which are set out in the said order. However, the learned counsel for the parties point out that none of these questions arise in the present appeal and such questions were framed, on account of incorrect tagging of this matter along with other matters which were presumed to be connected to this matter. 4. Ms. Linhares, learned counsel for the Appellant submits that the substantial question of law which arises in this appeal is the one set out in paragraph 5 (c) of the appeal memo and....

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.... no bar to maintainability of the present appeal. 7. Accordingly, we proceed to frame the aforesaid question as set out in paragraph 5(c) of the appeal memo as substantial question of law in the present appeal and proceed to decide the same. 8. In this case, the Respondent - Assessee filed his return of income for Assessment Year 2012-2013 declaring total income of Rs.88,83,130/-. This was followed by a revised return declaring a loss of Rs.6,91,77,785/-. The case was selected for scrutiny and due notice under Section 143(2) of the Income Tax Act, 1961 (IT Act) was issued to the Assessee. In the context of substantial question of law now framed, suffice to state that the Assessing Officer disallowed the interest of Rs.27,09,30,388/- paid ....

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....ppeal. 11. The liability to deduct tax at source arises from the provisions of Section 194A(1) of the IT Act. However, 194A(3) provides that the provisions of sub-section (1) of Section 194A will not apply in certain contingencies. One of the contingencies is provided in sub clause (v). This contingency relates to income credited or paid by a cooperative society to a member thereof. There is no dispute that this was the position for the Assessment Year 2012-2013 and therefore, we feel that the CIT (Appeals) as well as the ITAT were quite right in reversing the Assessing Officer's order and holding that there was no liability for deducting tax at source in respect of amount of interest paid by the cooperative society to its members, eve....