T.C.A.No.947 of 2019 IN HIGH COURT OF JUDICATURE AT MADRAS DATED : 05.08.2020 CORAM HONOURABLE MR.JUSTICE T.S.SIVAGNANAM and HONOURABLE MRS.JUSTICE V.BHAVANI SUBBAROYAN T.C.A.No.947 of 2019 M/s.Indian Overseas Bank Funds & Accounts Department 762, Anna Salai, Chennai 600 002. .. Appellant Versus Joint Commissioner of Incometax Special Range-I Chennai 600 034. .. Respondent Prayer:- Tax Case Appeal filed under Section 260-A of Income Tax Act, 1961, against order of Income Tax Appellate Tribunal, ''A'' Bench, Chennai dated 30th August 2011 in ITA No.782/(Mds)/01. For Appellant : Mr.R.Vijayaraghavan, Senior Counsel for Ms.Subbaraya Aiyar Padmanabhan For Respondent: Ms.R.Hemalatha Senior Standing counsel 1/8 http://www.judis.nic.in T.C.A.No.947 of 2019 JUDGMENT [Order of Court was made by T.S.SIVAGNANAM, J.] This appeal, filed by assessee, authorised Bank, under 260A of Income Tax Act, 1961 ('the Act' for brevity) challenging order dated 30.08.2011 passed by Income Tax Appellat Tribunal, Bench 'A' Chennai in I.T.A.No.782/Mds./2001 for assessment year 1992-93. appeal has been filed raising following substantial question of law. 1. Whether on facts and in circumstances of case Tribunal was right in law in holding that reopening of assessment is valid? 2. Whether on facts and in circumstances of case Tribunal was right in law in holding that reopening of assessment is valid on ground that appeal of assessee does not arise out of reasons recorded for reopening ignoring grounds of appeal taken before it? 3. Whether on facts and in circumstances of case Tribunal was right in confirming order of CIT(A) that ground relating to estimated disallowance of deduction u/s 80M does not arise out of order of reassessment without verifying computation of income? 2/8 http://www.judis.nic.in T.C.A.No.947 of 2019 2. We have elaborately heard Mr.R.Vijayaraghavan, learned Senior Counsel for Ms.Subbaraya Aiyar Padmanabhan, learned counsel for appellant / assessee and Ms.R.Hemalatha, learned Senior standing counsel for respondent Revenue. We have carefully perused impugned order passed by Tribunal. We find that it may not be necessary for us to go into merits of matter. We say so because Tribunal has not rendered any finding as to why grounds raised by assessee cannot be decided in their favour. two contentions which are subject matter of this appeal are reopening of assessment under Section 147 of Act and second issue is with regard to computation of deduction under Section 80M of Act. 3. To be noted that assessee has succeeded on merits and this appeal has pursued by assessee only on above mentioned two grounds. We note that following were grounds of appeal raised by assessee before Tribunal on aforementioned two issues: 3/8 http://www.judis.nic.in T.C.A.No.947 of 2019 i. learned CIT(A) had erred in confirming order of assessing officer in reopening assessment and charging to tax interest accrued but not due on securities and disallowing loss on revaluation of investments. appellant had filed details of these claims along with return of income and assessing officer in original assessment had allowed these only after examination of details filed. Hence reopening was based only on change of opinion and assessment needs to be struck down as invalid on theses grounds itself. ii. CIT(A) had erred in confirming reduction of Rs.4,79,494 being 5% of dividend income towards expenditure in computing deduction under Section 80M. CIT(A) should have noted that appellant has not incurred any expenditure for earning dividend income and hence no amount should have been disallowed. Besides appellant has huge interest free funds and hence question of apportionment of any interest towards earning income also does not arise. This view is supported by number of judicial decisions including that of Supreme Court and hence no amount should have been disallowed in computing deduction u/s 80M. 4/8 http://www.judis.nic.in T.C.A.No.947 of 2019 4. Finding of Tribunal in respect of first ground raised by assessee is as follows: 4. Thus, we find that ground no.1 of appeal of assessee for both years does not arise out of reasons recorded by learned assessing Officer. Hence, this ground of appeal of assessee is dismissed for both years under consideration. 5. finding of Tribunal in respect of second ground is as follows: 14. After hearing rival submissions, we find that learned Authorised Representative has not controverted findings of learned Commissioner of Income Tax (A) that this ground does not arise out of order of reassessment of learned Assessing Officer. Therefore, ground of appeal of assessee is dismissed. 6. bare reading of above shows that Tribunal has not given any independent reasons as to why grounds canvassed by assessee before Tribunal does not merit consideration. Tribunal is 5/8 http://www.judis.nic.in T.C.A.No.947 of 2019 required to record reasons as to why there is disagreement with finding of Lower Appellate Authority and why grounds raised by assessee cannot be entertained. Since order is devoid of reasons, we are constrained to interfere with impugned order to extent indicated and remand matter back to Tribunal for fresh consideration. 7. In light of above discussion, Tax Case Appeal is allowed and impugned order in I.T.A.No.782/Mds./2001 dated 30.08.2011, insofar as above two issues are set aside and remanded to Tribunal for fresh consideration in accordance with law. Consequently substantial questions of law are left open. No costs. (T.S.S.,J) (V.B.S.,J) 05.08.2020 sk Index: Yes / No Internet: Yes / No Speaking Order/Non-Speaking Order 6/8 http://www.judis.nic.in T.C.A.No.947 of 2019 To Joint Commissioner of Incometax Special Range-I Chennai 600 034. 7/8 http://www.judis.nic.in T.C.A.No.947 of 2019 T.S.SIVAGNANAM, J. AND V.BHAVANI SUBBAROYAN, J. sk T.C.A.No.947 of 2019 05.08.2020 8/8 http://www.judis.nic.in Indian Overseas Bank Funds & Accounts Department v. Joint Commissioner of Income-tax Special Range-I, Chennai