Commissioner of Income Tax vs Rajasthan State Co-Operative Bank Ltd.

The IT Reference No. 7 of 1976 relates to the assessment years 1966-67 to 1970-71. The reference application in this Court as such should be registered as 7, 7A, 7B, 7C and 7D of 1976, respectively. The reference No. 40 of 1976 relates to the assessment year 1971-72 and parties in all the above cases are identical and the following question has been referred for the opinion of this Court by the Tribunal, as such, they are disposed of by a common order:

"Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the provisions of section 81 (v) of the income tax Act, 1961 for the assessment years 1966-67 and 1967-68 and of section 80P(2)(f) of the income tax Act, 1961 for the assessment years 1968-69, 1969-70 and 1970-71 were not applicable to the interest received by the assessee on Government securities, which were held by it as part of its stock-in-trade?"

The learned counsel for the department has brought to our notice that Addl. CIT v. Rajasthan Co-operative Bank Ltd. [1984] 19 Taxman 189 (Raj.), Jaipur, between the same parties for the assessment" years 1962-63 to 1965-66 has already been disposed of by this Court on 13-3-1984. The decision in the aforesaid case fully governs the question of law raised in the case before us except that the assessment years are different. The Division Bench of this Court in Rajasthan Cooperative Bank Ltd.''s case (supra) has decided the following question which was raised before them:

"Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the provisions of section 81(v) of the income tax Act, 1961, were not applicable to the interest received by the assessee on Government securities which were held by it as part of its stock-in-trade?"

In the above case, it was held that on the facts and in the circumstances of the case, the Tribunal was right in holding that the provisions of section 81(v) of the income tax Act, 1961 (''the Act'') were not applicable to the interest received by the assessee on Government securities which were held by it as part of its stock-in-trade.

The question referred was answered in the affirmative.

The learned counsel for the department tried to distinguish the above case, but we do not feel inclined to take a different view. In the result, the question referred to us in these cases are also answered in the affirmative. There will be no order as to costs.