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TMI Blog2018 (6) TMI 824X X X X Extracts X X X X X X X X Extracts X X X X ..... s not earned by the bank since the borrower account was defined as “NPA” account and interest on such account cannot be accounted for as income - Held that:- As decided in ACIT vs. The Rohtak Central Cooperative bank [2015 (4) TMI 366 - ITAT DELHI] overdue interest not realized during the year and credited to suspense interest account cannot be taken to be the income of the assessee. CIT(A) has thus rightly deleted the addition in question. The same is upheld. There is no substance in the contention of the Ld. DR that the assessee was having no objection to this addition, since we find that it was an alternative submission of the assessee before the AO. - Decided against revenue - ITA No. 4144/DEL/2016 - - - Dated:- 11-6-2018 - Ms Suchitra Kamble, Judicial Member And Sh. Prashant Maharishi, Accountant Member Appellant by : Sh. S. S. Rana, CIT DR Respondent by : Sh. Sanjeev Jain, CA ORDER Per Suchitra Kamble, JM This appeal is filed by the assessee against the order dated 16/05/2016 passed by CIT(A)- Rohtak. 2. The grounds of appeal are as under:- 1. CIT(A) has erred in allowing the appeal of the assessee as the assessee itself admitted that he had a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n reply and produced books of accounts accounting records appeared personally before the Assessing Officer. The Assessing Officer observed that during the previous year, the assessee bank was claiming exemption u/s 80P(2)(a)(i) and was also getting the deposit from non members. The assessee was asked to give bifurcation of the deposits from members and non members. Vide order sheet entry dt 16.01.2015, the assessee was asked to justify its claim for deduction. Vide reply dt 20.02.2015, the assessee stated that it was not possible to bifurcate deposits from members and non members. Further, it was only accepting deposits from non members but the assessee was not deriving income from any non member. Also the Assessee submitted before the Assessing Officer that the same issue is adjudicated in his favour by the ITAT in Assessment Year 2009-10. The Assessing Officer held that in the present case the assessee itself admitted that they are receiving payments from non members also thus assessee loses its eligibility to claim deduction u/s 80P(2)(a)(i) of the Income Tax Act, 1961. Thus, the Assessing Officer disallowed the claim of deduction u/s 80P(2)(a)(i) of the Act. The Assessing O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relied upon the order of the CIT(A). 7. We have heard both the parties and perused the material available on record. The CIT(A) held as under:- 4. Ld. Assessing Officer has made the additions on mere suspicion and he has failed to appreciate the facts and explanation on records kept by the appellant amp; made all addition on his assumption basis only. We like to mention here that complete books of account with supporting documents have duly produced before Ld. AO. Ld. AO duly goes through the same before completing the scrutiny proceeding without pointing any adverse material on record. He made both the additions mere suspicion and he has failed to appreciate the facts and explanation on records since it was very well explained to Ld. AO that PARDB is fulfilling all the necessary requirement to claim deduction U/s 80P(2)(a)(i) and also that accrued Interest on NPA shown in balance sheet is accumulated balance of previous years and also such income was not earned by the bank since the borrower account was defined as NPA account and interest on such account can t be accounted for as income. In view of the both the above citation we hereby humbly request ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts members. On the deposits, it will pay interest which would be its expenses and would be set off against the total income generated from the credit facility. It has not income on the deposits from the non-members rather it must have paid interest on such deposits. This issue has elaborately been discussed by the ITAT in assessment year 2008-09 in the case of Palhawas Primary Agriculture Co-op Society. Respectfully following the order of the ITAT, we do not find any error in the impugned order of the Learned CIT(Appeals). 7. In result, both the appeals are dismissed. Thus, Ground No. 1 of the assessee s appeal herein is squarely covered by the decision of the Tribunal for A.Y. 2009-10 in Assessee s own case. Therefore, Ground No. 1 is dismissed. 8. As regarding to Ground No. 2 to 4 of the assessee s appeal, the accrued Interest on NPA shown in balance sheet is accumulated balance of previous years and also such income was not earned by the bank since the borrower account was defined as NPA account and interest on such account cannot be accounted for as income. The Tribunal in case of ACIT vs. The Rohtak Central Cooperative bank Ltd. being ITA No. 2839/DEL/2011 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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