TaxTMI 
TaxTMI 
2023 (9) TMI 1148
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....by accepting deposits and lending money to the members of the Sahakari. The assessee's business activities carried on are similar to the business of banking carried on by Co-operative Banks formed and registered under the Karnataka Societies Act, 1959. There was a survey under section 133A of the Act on 24.01.2018 at the headquarters of the assessee at Bellary. In the course of survey, it was noticed that assessee has not filed Annual Information Report (AIR) for the Assessment Years 2006-07 to 2014-15, despite the fact that the assessee had reportable transactions in terms of section 285BA(2) of the Act. Accordingly, show cause notice dated 26.09.2018 was issued for imposing penalty under section 271FA of the Act since assessee had not filed AIR as per the provisions of section 285BA(2) of the Act r.w.r. 114E of the Income Tax Rules, 1962. The assessee filed objections to the notice issued under section 271FA of the Act. The AO not being satisfied with the explanation submitted by the assessee, imposed penalty under section 271FA of the Act. The details of the Assessment Year and penalty imposed under section 271FA of the Act are as under: Assessment Year Penalty levied in I....
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.... Regulation Act, 1949 and further the Co-operative bank is included in the class of persons with effect from 1.4.2016 and not prior and thus, the appellant was under the bonafide belief that it was not required to file the AIR return under the facts and in the circumstances of the appellant's case. 3.1 The learned CIT[A] erred in upholding the penalty imposed u/s. 271FA of the Act without appreciating the aforesaid explanation of the appellant constituted enable cause for failure to comply with the provisions of 285BA and hence, in terms of section 273B of the Act, the penalty imposed ought to have been cancelled. 3.2 The learned CIT[A] further erred in not following the binding decisions of the Hon'ble ITAT relied upon by the appellant on the ground that the Hon'ble RAT has not looked into the fact that co- operative banks are governed by the Banking Regulation Act, 1949, which failure to follow the binding decision of the ITAT amount to judicial indiscipline. 4. Without prejudice to the above the learned CIT [Appeals] failed to appreciate that the learned JDIT (I & CI) was not the prescribed authority in terms of section 285BA[1] of the Act,....
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....a Co-operative Central Bank Vs. DIT (Intelligence and Criminal Investigation) in ITA No. 447/Bang/2019, order dated 13.03.2020. The provisions of Rule 114E(2) before the substitution w.e.f. 01.04.2015 and thereafter is set out in the impugned orders of CIT(A), hence the same is not reiterated here. The Rule under 114E(2) of the Rules lists out the persons who are required to furnish the AIR in terms of section 285BA of the Act. It is clear that in terms of Sl.Nos.1 and 2 of the Table under Rule 114E(2) of the Rules, before 01.04.2015 only banking companies or banking institutions (which includes the provisions of section 51 of the Banking Regulation Act, 1949) but not the provisions of section 56 or Part V of the Banking Regulation Act, 1949, that deals with Co-operative Societies were required to file the AIR. The co-operative banks have been brought within the ambit of Sl. Nos.1 to 4 of Table under Rules 114E(2) after 01.04.2015 and prior to that, the assessee being a Souhardha Sahakari, there was ambiguity as to whether Co-operative Banks are required to comply with the provisions of Rule 114E of the Rules, meaning thereby, the bonafide belief of the assessee would constitute a ....
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....n (reporting person) (1) (2) (3) 1. A banking company or a co-operative bank to which the Banking Regulation Act. 1949 (10 of 1949) applies (including any bank or banking institution referred to in section 51 of that Act). Cash deposits aggregating to ten lakh rupees or more in a year in any savings account of a person maintained in that bank. 6. We, on perusal of the provisions found that the co-operative bank has been included in the amendment w.e.f 1.4.2016 and is not disputed. The learned Authorized Representative supported the claim relying on judicial decisions and provisions of Banking Regulation Act read as under : 'Section 5i in BANKING REGULATION ACT. 1949 1[51. Application of certain provisions to the State Bank of India and other notified banks.---21" (1) Without prejudice to the provisions of the State Bank of India Act, 1955 (23 of 1955), or any other enactment, the provisions of section 10, 13 to 15, 17 253 [19 to 21A, 23 to 28, 29 (excluding sub-section (3)] 265[sub-sections (1B), (1C), and (2) of section 30], 31, 34,35,35A, 36 [excluding clause (d) of sub-section (1)], 45Y to 45ZF, 46 to 48],50,52 and 53 sha....
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....reased to 11 from F.Y. 2011-12. We found strength in the submission of learned Authorized Representative that the assessee bank was in Bona Fide belief that there is no requirement to file this statement as the law is application from 1.4.2016. We found under the provisions of Section 273B of the Act where penalty need not be imposed, if there exists a reasonable cause. We consider appropriate to the provisions of Section 273B which is read as under : " 273B. Notwithstanding anything contained in the provisions of clause (b) of sub-section (1) of section 271, section 271A, section 271AA, section 271B section 271BA, section 271BB, section 271C, section 271CA, section 271D, section 271E, section 271F, section 271M section 271FAB, section 271FB, section 271G, section 271GA, section 271GB, section 271H, section 271I, section 271J, clause (c) or clause (d) of sub- section (1) or sub-section (2) of section 272A sub-section (1) of section 272AA or section 272B or sub-section (1) or sub-section (1A) of section 272BB or sub-section (1) of section 272BB or clause (b) of sub-section (1) or clause (b) or clause (c) of sub-section (2) of section 273, no penalty shall be imposable on th....