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TMI Blog2021 (9) TMI 453X X X X Extracts X X X X X X X X Extracts X X X X ..... see : Ms. Urvashi Shodhan, A.R. ORDER PER : AMARJIT SINGH, ACCOUNTANT MEMBER:- By way of this Miscellaneous Application, the assessee is seeking recalling of the order dated 30th January, 2020. The assessee has mainly submitted in the Miscellaneous Application that there is an error apparent in dismissing the appeal filed by the assessee in not granting deduction of interest of ₹ 1,66,385/- earned from co-operative bank claimed u/s. 80P(2)(d) of the act. The assessee has submitted that deduction ought to have been granted as per the judgment of Hon'ble Jurisdictional High Court in the case of CIT-II vs. Sabarkanta District Co-operative Milk Ltd. in Tax Appeal No. 473 of 2014. 2. Heard both the sides and perused the material on record. In this regard, we consider that specific facts and judicial finding referred by the assessee has been considered by the ITAT while adjudicating impugned issue. The relevant finding on this issue of the ITAT is reproduced as under:- "8. We have heard both the sides and perused the material on record. During the course of appellate proceedings before us, the ld. counsel has placed reliance upon the decision of Hon'ble High Court of Guja ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2)(d) on the basis of attracting provision of section 14A of the Act as narrated above as per the order of ITAT Vide ITA No.2613/Ahd/2012 dated 27.09.2013 in the case of ACIT vs. Sabarkantha District Co- operative Milk Producers Union Ltd. On the other hand, the issue involved in this case of the assessee is claim of deduction of interest income u/s. 80P(2)(d) of the act earned on idle funds placed with co-operative bank. However, on the issue of earning similar nature of interest from the commercial bank the Jurisdictional Hon'ble High Court in the case of SBI vs. CIT (2016) 72 taxman.com 64 has held that interest income on deposit placed with the commercial bank is not entitled for deduction u/s. 80P(2)(a)(i) of the act. In the light of the above, we are of the view that the income by way of interest earned by deposit of idle fund does not change its character irrespective of the fact whether such income of interest is earned from a schedule bank or a co- operative bank. The identical issue on the similar facts has been adjudicated by the Co-ordinate Bench of the ITAT after considering the decision of Hon'ble High Court of Karnatka in the case of Pr. CIT s. Tatagars Co-op ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - operative Sale Society on identical issue and facts has held that it is only primary agricultural credit society with its limited work of providing credit facilities to its member which is governed by ambit and scope of deduction u/s. 80P and further stated that interest income earned from surplus deposit with co-operative bank is not entitled for deduction 80P(2)(d). The relevant part of the decision of the Hon'ble High Court of Karnataka, in the case of (2017) 83 taxmann.com 140 (Kar) Principal CIT vs. Tatagars Co-operative Sale Society on identical issue and facts is reproduced as under:- "Admittedly and undoubtedly, the assessee is a co-operative Society engaged mainly in the activity of marketing of agricultural produces grown by its members. The assessee cooperative society also accepts deposits from its members and provides credit facility to its members, runs Mahalaxmi Credit Co-op. Society Ltd. vs. ITO Kirana Stores, rice mills, live stocks, van section, medical shops, lodging, plying and hiring of goods carriage, etc. [Para 10] The assessment years involved in the instant appeals are assessment years 2007-08 to 2011-12. The bone of contention is that the dedu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deduction under section 80P of the Act. [Para 13] The banking business, even though run by a Cooperative bank is sought to be excluded from the beneficial provisions of exemption or deduction under section 80P of the Act. The purpose of bringing on the statute book subsection (4) in section 80P was to exclude the applicability of section 80P altogether to any co-operative bank and to exclude the normal banking business income from such exemption/deduction category. The words used in section 80P(4) are significant. They are: 'The provisions of this section shall not apply in relation to any co- operative bank other than a primary agricultural credit society................' The words 'in relation to' can include within its ambit and scope even the interest income earned by the assessee, a cooperative society from a Co-operative Bank. This exclusion by section 80P(4) even though without any amendment in section 80P(2)(d) is sufficient to deny the claim of the assessee for deduction under section 80P(2)(d). The only exception is that of a primary agricultural credit society. The depository Kanara District Central Bank Limited in the present case is admittedly not such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the income by way of interest earned by deposit or investment of idle or surplus funds does not change its character irrespective of the fact whether such income of interest is earned from a scheduled bank or a co-operative bank and, thus, clause (d) of section 80P(2) of the Act would not apply in the facts and circumstances of the present case. The person or body corporate from which such interest income is received will not change its character, viz. interest income not arising from its business operations, which made it ineligible for deduction under section 80P of the Act. [Para 23] In view of the aforesaid, the appeal filed by the revenue deserves to be allowed.:" [Para 24] In the light of the above facts and legal findings we consider that the income by way of interest earned by deposit or investment of idle or surplus does not change its character irrespective of the fact whether such income of interest is earned from a schedule bank or a co-operative bank and thus clause (d) of section 80P(2) of the act would not apply in the facts and the circumstances of the present case. The assessee has earned interest income on surplus funds deposited with nationalized bank and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oints on which there may conceivably be two opinions. However, the question of rectification of mistake cannot be entertained until and unless the Miscellaneous Petition filed by the assessee is found to be maintainable. In the case of assessee this Miscellaneous application filed by the assessee is beyond the period of six months from the date of passing of this order of the ITAT on 30th January, 2020 and therefore the same is barred by limitation. The Miscellaneous Petition seeking rectification of any mistake apparent from record can be filed by either side within a period of six months from the end of month for which the order was passed. In the present case, the order was passed on 30th January, 2020, therefore, the limitation for filing of Miscellaneous Petition u/s. 254(2) starts from 1st Feb, 2020 to 31st July, 2020. However, the Miscellaneous Application has been filed by the assessee on 1st Sep, 2020 in spite of the fact that as per record the order of the ITAT dated 30th Jan, 2020 was received by the assessee on 19th Feb, 2020. Therefore, the Miscellaneous Petition has not been filed within the time limit prescribed under the provision of section 254(2) of the Act. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ench of Tribunal in the case of Rahul Jee & Co. (P) Ltd. Vs. Assistant Commissioner of Income Tax reported as 120 ITD 481 and several other decisions by various Benches of the Tribunal. 6. The ld. Counsel for the assessee has placed reliance on the decision of Hon'ble Madhya Pradesh High Court in the case of District Central Co- op. Bank Ltd. Vs. Union of India (supra). We find that the facts in the said case are distinguishable. In the said case the order of Tribunal was passed MA No. 38/PUN/2017, A.Y. 2003-04 before amendment of section 254(2) by the Finance Act 2016. The Tribunal rejected application of the assessee u/s. 254(2) by applying amended provisions. The Hon'ble High Court allowing the petition of assessee held that the new law of limitation providing a shorter period cannot be applied retrospectively. It is not the case of assessee that the Tribunal order sought to be rectified is passed prior to amendment. Thus, the case law on which the ld. Counsel for the assessee has placed reliance does not support the cause of assessee. 7. The Tribunal cannot go into the reasons/merits for filing of Miscellaneous Application, as the Miscellaneous Application of the as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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