Ita/51/2016 Of The Chemanchery Service Co-Operative Bank Ltd v. Commissioner Of Income Tax, Calicut

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE THOTTATHIL B.RADHAKRISHNAN &THE HONOURABLE MRS. JUSTICE ANU SIVARAMAN TUESDAY, THE 5TH DAY OF APRIL 2016/16TH CHAITHRA, 1938 ITA.No. 51 of 2016 () ---------------------- AGAINST THE ORDER/JUDGMENT IN ITA 286/2015 of I.T.A.TRIBUNAL,COCHINBENCH DATED 26-08-2015 APPELLANT(S)/APPELLANT/ASSESSEE: ------------------------------- THE CHEMANCHERY SERVICE CO-OPERATIVE BANK LTD. P.O.CHEMANCHERRY, KOYILANDY TALUK, KOZHIKODE DISTRICT - 673 304 REPRESENTED BY ITS SECRETARY, DHANANJAY NARAYANAN. BY ADVS. SRI.S.ARUN RAJ SMT.C.T.SUJA RESPONDENT(S)/RESPONDENT/REVENUE: --------------------------------- COMMISSIONER OF INCOME TAX, CALICUT 673 001. BY SRI.K.M.V.PANDALAI, INCOME TAX DEPARTMENT THIS INCOME TAX APPEAL HAVING BEEN FINALLY HEARD ON05-04-2016, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: THOTTATHIL B.RADHAKRISHNAN& ANU SIVARAMAN, JJ. ----------------------------------------------- ITA.No.51 of 2016 -----------------------------------------------Dated this the 5[th] April, 2016 JUDGMENT Anu Sivaraman, J. We have heard Sri.Arun Raj S, learned counsel appearingfor the appellant and Sri.K.M.V.Pandalai learned standingcounsel for Income Tax Department. 2. The matter raised is interlinked with the issues in I.T.A.No.212 of 2013 and connections, as rightly pointed out bythe learned counsel on all sides. Under such circumstances, weadopt the following substantial questions of law, which wereformulated in I.T.A.No. 212 of 2013 and connections, asquestions that arise from the appeals which are bunched upand decided through this judgment: A) Whether on the facts and in the circumstancesof the case under consideration, the Tribunal iscorrect in law in deciding against the assessee,the issue regarding entitlement for exemptionunder section 80P, ignoring the fact that theassessee is a primary agricultural creditsociety?of the case under consideration, the Tribunal iscorrect in law in deciding against the assessee,the issue regarding entitlement for exemptionunder section 80P, ignoring the fact that theassessee is a primary agricultural creditsociety? B) Whether the Tribunal is justified in denying theexemption under section 80P of the IncomeTax Act, 1961, on the mere ground of belatedfiling of return by the assessee?exemption under section 80P of the IncomeTax Act, 1961, on the mere ground of belatedfiling of return by the assessee? ITA.51/16 C) Whether a return filed by the assessee beyondthe period stipulated under section 139(1)/(4)or section 142(1)/148 can be held as non estin law and invalid for the purpose of decidingexemption under section 80P of the IncomeTax Act, 1961?the period stipulated under section 139(1)/(4)or section 142(1)/148 can be held as non estin law and invalid for the purpose of decidingexemption under section 80P of the IncomeTax Act, 1961? D) Whether the Tribunal is correct in law or isjustified in restricting the provisions for badand doubtful debt at the 7.5% of the grosstotal income, on the reason that the assesseeis not entitled for the status of rural branch toclaim 10% of the aggregate average advancesas bad and doubtful debt, under section 36(1)(viia) of the Income Tax Act, 1961?justified in restricting the provisions for badand doubtful debt at the 7.5% of the grosstotal income, on the reason that the assesseeis not entitled for the status of rural branch toclaim 10% of the aggregate average advancesas bad and doubtful debt, under section 36(1)(viia) of the Income Tax Act, 1961? 3. Questions (A), (B) and (C) were answered as per the D) Whether the Tribunal is correct in law or isjustified in restricting the provisions for badand doubtful debt at the 7.5% of the grosstotal income, on the reason that the assesseeis not entitled for the status of rural branch toclaim 10% of the aggregate average advancesas bad and doubtful debt, under section 36(1)(viia) of the Income Tax Act, 1961?justified in restricting the provisions for badand doubtful debt at the 7.5% of the grosstotal income, on the reason that the assesseeis not entitled for the status of rural branch toclaim 10% of the aggregate average advancesas bad and doubtful debt, under section 36(1)(viia) of the Income Tax Act, 1961? 3. Questions (A), (B) and (C) were answered as per the judgment dated 15.2.2016 in ITA.No.212 of 2013 andconnections. Those findings and answers to those questions areincorporated in answer to questions (A), (B) and (C) formulatedherein. A copy of the judgment in ITA.No.212 of 2013 andconnections will stand appended to this judgment. With the aforesaid, we remit this matter for reconsideration by the Income Tax Appellate Tribunal in thelight of the answers rendered herein on substantial questions oflaw (A), (B) and (C). The Tribunal will thereupon consider the ITA.51/16 issues relating to the bad and doubtful debts and the claim ofthe assessee in that regard by treating that in all cases whereexemptions are claimed under section 80P and such matterswere pending before the assessing authority or before theappellate authority, including in this appeal, the question ofexemption available under section 80P was still available fordecision. THOTTATHIL B.RADHAKRISHNAN JUDGE ANU SIVARAMAN JUDGE vgs8/4