The Commissioner Of Income Tax v. M/S Sultanpur Lodhi Primary Co-Op. Agri. Dev. Bank Ltd

IN THE HIGH COURT OF PUNJAB AND HARYANA ATCHANDIGARH. I.T.A. No.323 of 2010 (O&M)Date of decision: 4.8.2010 The Commissioner of Income Tax. -----Appellant. Vs. M/s Sultanpur Lodhi Primary Co-op. Agri. Dev. Bank Ltd. -----Respondent CORAM:- HON'BLE MR. JUSTICE ADARSH KUMAR GOELHON'BLE MR. JUSTICE AJAY KUMAR MITTAL Present:-Mr. Vivek Sethi, Standing counselfor the Revenue. --- ADARSH KUMAR GOEL, J. This appeal has been preferred by the revenue underSection 260-A of the Income Tax Act, 1961 against the orderdated 25.9.2009 in I.T.A. No.311(Asr)/2009 passed by theIncome Tax Appellate Tribunal, Amritsar, proposing to raisefollowing substantial question of law:- “(i)Whether the Hon’ble ITAT is right in confirmingthe order of Ld. CIT(A) on the issue ofdisallowance of interest made by the A.O. atRs.8,69,190/- on deposits/investments withSADB when the assessee paid interest to SADBat Rs.84,79,910/- without charging the same ondeposits/investments with SADB. the order of Ld. CIT(A) on the issue ofdisallowance of interest made by the A.O. atRs.8,69,190/- on deposits/investments withSADB when the assessee paid interest to SADBat Rs.84,79,910/- without charging the same ondeposits/investments with SADB. (ii)Whether the Hon’ble ITAT is right in dismissingthe appeal of the revenue on the issue ofdisallowance of deduction u/s 80P on notionalinterest calculated by the A.O. on investment ofsurplus reserves where such investment is notgoverned by any statutory provisions forcarrying on the business of banking.the appeal of the revenue on the issue ofdisallowance of deduction u/s 80P on notionalinterest calculated by the A.O. on investment ofsurplus reserves where such investment is notgoverned by any statutory provisions forcarrying on the business of banking. (iii)Whether the Hon’ble ITAT was right indismissing the appeal of the revenue on theissue of disallowance of deduction u/s 80P onthe said notional interest calculated by A.O. viz-a-viz amounts/investments other than statutoryreserves when the Hon’ble Supreme Court hasset aside the similar issue to the file of CIT(A) inthe case of Mehsana District Co-op Bank Ltd.Vs. ITO 251 ITR 522.”dismissing the appeal of the revenue on theissue of disallowance of deduction u/s 80P onthe said notional interest calculated by A.O. viz-a-viz amounts/investments other than statutoryreserves when the Hon’ble Supreme Court hasset aside the similar issue to the file of CIT(A) inthe case of Mehsana District Co-op Bank Ltd.Vs. ITO 251 ITR 522.” Learned counsel for the Revenue fairly states that thematter is covered against the Revenue by judgment of this Courtdated 2.2.2010 in I.T.A. No.594 of 2009 CIT v. M/s ShivalikKshetriya Gramin Bank. In view of above, this appeal is dismissed. (ADARSH KUMAR GOEL) JUDGE August 04, 2010MITTAL )ashwani ( AJAY KUMAR JUDGE