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TMI Blog2024 (12) TMI 425X X X X Extracts X X X X X X X X Extracts X X X X ..... AO relied on district-wise data from the 2011 Census, which led to the erroneous rejection of the rural branch status for five branches of the assessee. Due to the absence of village-wise data in the 2011 Census, the assessee appropriately relied on the final data from the 2001 Census to claim the deduction. AO, acting on an incorrect assumption, disallowed the deduction and made an addition to the income. Upon review, we find no error in the impugned appellate order, which appropriately addressed the matter. Accordingly, the revenue's appeal is dismissed. - Shri. Narendra Kumar Billaiya, Accountant Member And Anikesh Banerjee, Judicial Member For the Assessee : Shri C Naresh For the Respondent : Shri R.A. Dhyani, CIT DR ORDER PER SH ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee. During the impugned assessment year, the assessee claimed deduction amount to Rs. 107,99,49,912/- towards 10% of average rural advances in respect of 90 rural branches. However, the population figure for classification of the said branches was taken by the assessee on the basis of census 2001 instead of census 2011 despite the availability of provisional population figure of census 2011, as on 01st April, 2012. The rectification order was made under section 154 and the Ld.AO had changed the status of 5 rural branches of the assessee whose population was supposed to exceed 10,000. The assessment order was rectified and the assessee s claim U/s 36(1)(viia) of the Act was reduced amount to Rs. 18,40,28,816/-. The aggrieved assessee filed a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s were submitted before the ld. CIT(A) and the issue was correctly considered. The ld. AO only relied of district-wise population which vicious the entire observation. He fully relied on the relevant paragraphs of the impugned appeal order and accordingly para 4.2 to 4.4 are reproduced below: - 4.2 I have carefully gone through the rectification order, grounds of appeal, statement of facts filed, written submission uploaded as well as oral contention of the appellant. The only effective ground of appeal to be adjudicated in the present appeal is in respect of reducing of deduction u/s 36(1)(viia) by Rs. 18,40,28,816/- on the ground that appellant has wrongly taken the classification of rural branch on the basis of population of 2001 census ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t, I am of the view that AO has erred in invoking the provisions of section 154 of the Act and reducing the deduction with respect to provisions u/s 36(1)(viia) of the Act for rural branches on the basis of provisional population figure of census 2011 which were available before 01.04.2012. It is an admitted fact on record that there was variation between provisional and final population total. For the purpose of classification of rural branches, the figure of census which have been published before the first day of previous year should be taken as per the explanation (ia) provided in the section 36(1)(viia). As pointed out above the final population data of census 2011 was not available on the first day of previous year for the relevant A. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vs. ACIT, Bengaluru (57 taxmann.com 253 [Kar]), but note that the facts in those cases are distinguishable. The assessee utilized village-wise population data for its rural branches, where the population was less than 10,000, to determine eligibility for deduction under Section 36(1)(viia) of the Act. In contrast, the Ld. AO relied on district-wise data from the 2011 Census, which led to the erroneous rejection of the rural branch status for five branches of the assessee. Due to the absence of village-wise data in the 2011 Census, the assessee appropriately relied on the final data from the 2001 Census to claim the deduction. The Ld. AO, acting on an incorrect assumption, disallowed the deduction and made an addition to the income. Upon re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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