Case Law Details
Raddi Sahakara Bank Niyamitha Vs ACIT (ITAT Bangalore)
ITAT Bangalore held that cooperative societies carrying on banking business when it pays interest to its members on deposits need not deduct tax at source in view of the provisions of Sec.194A(3)(v) of the Act.
Facts- The instant appeal filed by the assessee is directed against the order passed by the National Faceless Appeal Centre (NFAC). Notably, the matter involved tax deduction at source on interest paid by co-operative banks. The matter was decided ex-parte against the assessee. Being aggrieved, assessee has preferred the present appeal.
Conclusion- Held that the impugned order is ultimately an ex-parte one. The documents furnished before First Appellate Authority physically on 15/5/2018 were also not taken into consideration by the ld.CIT(A), Faceless as impugned before us. This is clearly a violation of the principle of natural justice. The deliberation on this documents should have been made by the authorities below while dealing with the issue involved in the appeal preferred before the First Appellate Authority and in the absence of the same, the entire proceedings initiated by the ld.CI(TA) is found to be bad in law and requires re-adjudication of the same.
Held that amendment to the Rule though has been made by the Finance Act, 2015 to this effect that no such deduction would be required for interest paid by a cooperative society to its members in terms of the provision of sec. 194A(3)(v) of the Act.
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