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ACIT(TDS) 13-A, Subhash Road, Dehradun Vs. State Bank of India, Tel Bhawan, Dehradun
October, 09th 2015
              DELHI BENCH `G', NEW DELHI
       Before Sh. G. C. Gupta, Hon'ble Vice President
            Sh. O.P.Kant, Accountant Member
                        ITA No.4911/Del./2013
                         Asstt. Year : 2007-08

      ACIT(TDS)                  Vs    State Bank of India,
      13-A, Subhash Road,              Tel Bhawan,
      Dehradun                         Dehradun
      (APPELLANT)                      (RESPONDENT)
                                      PAN No. MRTSO2193C
               Appellant by : Sh. Sujit Kumar, Sr. DR
               Respondent by : Sh. O.P. Sapra, Sr. Adv.
                               Sh. Bishwajeet Bhattacharya, Adv
                               Sh. Jeetan Nagpal, CA

  Date of Hearing : 30.09.2015        Date of Pronouncement :06.10.2015



     This appeal of the Revenue is directed against the order of the
learned Commissioner of Income-Tax (Appeals)-I, Dehradun dated
31.05.2013 in respect of assessment year 2007-08. The Revenue has
raised following grounds:-
     "1. The CIT(A) has erred in law and on facts in holding the
     order of the AO as barred by limitation ignoring the facts that
     the assessee had not raised this issue before the AO and
     therefore the ld CIT(A) should have been given an opportunity
     to the AO before deciding the issue.
                                 2                ITA No.4911/Del/2013

     2.    The ld CIT(A) has erred in law and facts in holding the
     order of the AO as barred by limitation by treating the order of
     AO to be covered u/s 201(3)(i) of the IT Act ignoring the fact
     that the assessee has not filed any TDS statement in respect of
     impugned transaction and therefore the case cannot be said to
     be covered u/s 201(3)(i) of the IT Act. The TDS verification was
     conducted on 19.02.2013 and order of the AO passed on
     22.03.2013 and therefore the order of the AO was well within
     limitation period."

2.   Facts in brief are that the assessee is a scheduled
commercial bank and a verification of Tax Deducted at
Source   (TDS)     was    carried    out   by   the    " Income-tax
Department" on 19/02/2013 on the branch of the assessee
bank located at Tel Bhawan, Dehradun. During verification
it was observed that the " Oil and Natural Gas Corporation
Ltd. " (in short " ONGC " ) was maintaining an account called
Site Restoration Account (SRA) with the assessee. The
learned A ssessing Officer (in short ,,A O ) observed that no
tax was deducted by the assessee bank on the interest which
accrued on the said account to the ONGC. Before the ld AO,
the assessee submitted that as per provisions of section
33ABA of the Income Tax Act (in short ,,the Act) , the
amount credited by way of interest in special account or
SRA does not attract a tax liability payable by the ONGC
limited because the interest on SRA credited by the as sessee
was deemed to be a deductible deposit and therefore
                              3              ITA No.4911/Del/2013

excluded from the total income chargeable under the Act.
Further, the assessee contended that the interest was not
taxable even at the time of withdrawal if the same was
utilized for the purposes contained in the SRA scheme in
accordance with the provisions of the Act. The ld. AO,
however, did not accept the contention of the assessee and
held the assessee to be in default in deducting of tax and
raised demand u/s 201 and interest u/s 201(1A) of the Act.
Against the said order of the ld. AO, the assessee filed
appeal before the learned Commissioner of Income-tax
(appeals) [in short ,, CIT(A) ] , who, then held that as per
clause (i) of provisions of section 201(3) of the Act, the AO
was required to pass the order within 2 years from the end
of financial year in which the statement as referred in
section 200 was filed, however the AO failed to comply the
said limitation, and therefore, the order of the ld. AO was
held invalid being barred by limitation. Accordingly, the ld
CIT(A) did not adjudicate matter on merit. Aggrieved, the
Revenue has filed an appeal before us.
3.   At the outset, the learned Authorised Representative
(in short ,,AR) of the assessee submitted that on merit, the
decision of the co-ordinate bench of the Income-tax
Appellate Tribunal ( ITAT) in ITA No.3936, 3937 and
3938/Del/2013, for the Assessment Year 2010-11, 2011-12
                              4               ITA No.4911/Del/2013

and 2012-13, in the case of the assessee, is in favour of the
assessee. In the above appeal, the coordinate bench in para
17.11 of the decision, has held that Site Restoration
Account deposit is not a term deposit for a fixed period and
therefore in view of clause (vii) to section 194A(3) , the
provision of section 194A are not attracted. A copy of the
said order was also provided to the learned Commissioner
(Department Representative) [in short ,,CIT(DR)] , who was
directed to file objections if any to whether issue is covered
by the above decision, however, she could not controvert
the submission of the ld AR. We have gone though the
above decision and find that the identical issue is involved
in appeal in hand and the decision of the ITAT being a
precedent, we are bound to follow. Accordingly, following
the decision of coordinate bench of the ITAT in the case of
the assessee itself, we hold that Site Restoration Account is
not a term deposit for a fixed period and therefore in view
of clause (vii) to section 194A(3) , provision of section
194A are not applicable and the assessee was not liable for
deducting tax at source on the interest credited in SRA .
4.   In view of the our finding as above, the ground of the
Revenue that the ld CIT(A) erred in holding that the orders
of the AO was barred by the limitation, is rendered merely
academic    and   have   become     infractuous,      hence          no
                                      5              ITA No.4911/Del/2013

adjudication         is   required.   Accordingly,   ground       of        the
Revenue is dismissed.
5.       In the result the appeal of the Revenue is dismissed.
         Order Pronounced in the Court on 06/10/2015.
         -Sd/-                                             -Sd/-
  (G.C. Gupta)                                  (O.P.Kant)
VICE PRESIDENT                              ACCOUNTANT MEMBER
Dated:06 / 10/2015
Copy forwarded to:
1. Appellant
2. Respondent
3. CIT
4. CIT(Appeals)
                                            ASSISTANT REGISTRAR
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