Ita/100162/2015 Of The Principal Commissioner Of Income Tax v. The Bagalkot District Central

IN THB HIGH COURT OF KARNATAKA DHARWAD BENCH DATEBD THIS THE 1 DAY OF DECEMBER, 2015 PRESENT THE HON’BLE MR.JUSTICE S. ABDUL NAZEER AND THE HON’BLE MR.JUSTICE P.S.DINESH KUMARITA No. J1GQ0162 OF 2 BRIWEHEN ITHE PRINCIPAL COMMISSIONER OFINCOME TAX, DR. B.R.AMBEDKARINCOME TAX, DR. B.R.AMBEDKAR ROAD, BELGAUM. ~ITO, TDS WARD,BBELGAUM.BBELGAUM. ... APPBLLAN (BY SRI Y.V.RAVIRAJ, ADV.) ANT THER BAGALKOT DISTRICT CENTRACOOPERATIVE BANK LTD.,SECTOR NO.24, NAVANAGAR,BAGALKOT,PAN: AAAA TT /9 ... RESPONDE (BY SRI A.SHANKAR, ADV.) THIS ITA IS FILED UNDER SECTION QJ6O0A OF TINCOME TAX ACT, 1961 TO SET ASIDE THE ORDER PASSEDBY THE INCOME TAX APPELLATE TRIBUNAL, PANAJI BENCHPANAJI, IN ITA NO.364/PNJ/2014, DTD:17.06.2015 FOR THEASSESSMENT YEAR 2012-13 AND EIC. THIS ITA COMING ON FOR ORDERS THIS DAY,P.S.DINESH KUMAR, J.2DELIVEREDTHERE FOLLOWIN JUDGMENT In this appeal by the Revenue, the issue involvedis for consideration whether the Co-operative Bank wasrequired to deduct tax while paying interest to itsmembers on time deposits under Section 194-A of theIncome Tax Act. a2The Ministry of Finance, Government ofIndia vide Circular No.19/2015 in F.No.142/14/2015-TPL, has held that the Co-operative Banks are notrequired to deduct tax at source on time deposits of its members paid or credited on or before 1.7.2015. Therelevant portion of the circular reads as under; “42.95 In view of this, the provisions of thsection 194A(3)(v) of the Income-tax Act havebeen amended so as to expressly providethat the exemption provided from deductionof tax from payment of interest to membersby a co-operative society under section194A(3)(v) of the Income-tax Act shall notapply to the payment of interest on timedeposits by the co-operative banks to itsmembers.As this amendment is ettfectivfrom the prospective date of l[/,]June, 2015,the co-operative bank shall be required todeduct tax from the payment of interest ontime deposits of its members, on or after the1[/,]June, 2015. Hence, a cooperative bankwas not required to deduct tax from thepayment of interest on time deposits of itsmembers paid or credited before l[/,]June,2015.” 3.In view of the aforesaid circular, this appeal does not survive for consideration and is accordinglydismissed. No costs. Sd/-JUDGE.Sd/-JUDGE. KLY/