Commissioner of Income-tax, Aurangabad v. Jalna Peoples Cooperative Bank Ltd
[Citation -2014-LL-1202-42]

Citation 2014-LL-1202-42
Appellant Name Commissioner of Income-tax, Aurangabad
Respondent Name Jalna Peoples Cooperative Bank Ltd.
Court HIGH COURT OF BOMBAY AT AURANGABAD
Relevant Act Income-tax
Date of Order 02/12/2014
Assessment Year 2007-08
Judgment View Judgment
Keyword Tags substantial question of law • financial institution • interest accrued • accrued income
Bot Summary: Whether a financial institution is entitled to exemption on so called income of interest accrued on non performing assets, was still a question and such question was answered in various judgments which were delivered prior to 2006. One of such judgments is reported in 4 Supreme Court Cases 599 in the case of Uco Bank, Calcutta Versus Commissioner of Income Tax, W.B. This judgment is quite significant statement of law as it takes into account methods of accounts adopted by banks and financial institutions. Whether the respondent bank is a scheduled bank as understood by Section 43 C of Income Tax Act. Schedule bank is a bank as per Section 5(C) of Banking Regulation Act is a banking company. Do not find it necessary to interfere in the judgment. Uploaded on - 19/12/2014 Downloaded on - 03/07/2020 18:15:28 3 ita62-13.odt 3 The learned counsel for the revenue, placed reliance on judgment reported in 2010 SCC 548 in the case of Southern Technologies Ltd. Versus Joint Commissioner of Income Tax, Coimbatore. We are not relying on this judgment, mainly because this judgment pertains to non banking financial companies, where similar question in respect of such non banking financial companies was involved but this law would not affect our judgment and also the judgment of Supreme Court in the case of Uco Bank cited supra.


ita62-13.odt IN HIGH COURT OF JUDICATURE OF BOMBAY BENCH AT AURANGABAD INCOME TAX APPEAL NO.62/2013 Commissioner of Income Tax Aayakar Bhavan, Near Holy Cross School, Cantonment, Aurangabad .APPELLANT Versus Jalna Peoples Cooperative Bank Ltd. Jalna .RESPONDENT .. Mr.Alok Sharma, Sr.Standing Counsel for appellant Mr.D.S.Ladda h/f Mr. R.M.Sharma, Adv. for respondent .. CORAM : A.V.NIRGUDE & V.L.ACHLIYA,JJ. DATE : 2nd December, 2014. ORAL ORDER [PER A.V.NIRGUDE,J.] : learned counsel for appellant suggested that this appeal would give rise to substantial question of law as to whether Section 43 D of Income Tax Act is applicable to present case. 2] According to him, case pertains to year 2007 08, when present provisions of Section 43 D, 36 and 80 P Uploaded on - 19/12/2014 Downloaded on - 03/07/2020 18:15:28 {2} ita62-13.odt were not in statute book as they appear now. In such situation, whether financial institution is entitled to exemption on so called income of interest accrued on non performing assets, was still question and such question was answered in various judgments which were delivered prior to 2006. One of such judgments is reported in (1999) 4 Supreme Court Cases 599 in case of Uco Bank, Calcutta Versus Commissioner of Income Tax, W.B. This judgment is quite significant statement of law as it takes into account methods of accounts adopted by banks and financial institutions. question before Court was whether interest accrued but not recovered can be said to be income and can be taxed. Supreme Court after careful consideration of question held that in certain cases such accrued income is not taxable. There is one more question. Whether respondent bank is scheduled bank as understood by Section 43 C of Income Tax Act?. answer is in affirmative. Schedule bank is bank as per Section 5(C) of Banking Regulation Act is banking company. We therefore, do not find it necessary to interfere in judgment. We hold that no substantial question of law arises in this appeal. Uploaded on - 19/12/2014 Downloaded on - 03/07/2020 18:15:28 {3} ita62-13.odt 3] learned counsel for revenue, placed reliance on judgment reported in 2010 (2) SCC 548 in case of Southern Technologies Ltd. Versus Joint Commissioner of Income Tax, Coimbatore. We are not relying on this judgment, mainly because this judgment pertains to non banking financial companies, where similar question in respect of such non banking financial companies was involved but this law would not affect our judgment and also judgment of Supreme Court in case of Uco Bank cited supra. Appeal is dismissed. V.L.ACHLIYA,J. A.V.NIRGUDE,J. umg/ Uploaded on - 19/12/2014 Downloaded on - 03/07/2020 18:15:28 Commissioner of Income-tax, Aurangabad v. Jalna Peoples Cooperative Bank Ltd
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