1. With the consent of learned counsel for the parties, both these appeals are taken up for final disposal today.
2. These appeals arise from the decision dated June 21, 2000, of the Income-tax Appellate Tribunal, Ahmedabad, in ITA Nos. 3483 of 1997 and 410 of 1999 in respect of the assessment years 1994-95 and 1995-96, respectively. The Tribunal has held that interest income of the appellant-bank on the investments made to the extent of reserve funds of the respective assessment years was outside the purview of Section 80P(2)(a)(i) of the Income-tax Act, 1961, and that the exemption has, therefore, rightly been denied by the Assessing Officer. However, the Tribunal accepted the alternative contention of the assessee for deduction for proportionate amount of expenses in respect 6f interest on the reserve funds.
3. Both the appeals were admitted on the following substantial question of law on September 20, 2000 :
"Whether, in the facts and circumstances of the case, the Income-tax Appellate Tribunal was right in law in holding that the assessee is not eligible for deduction under Section 80P in respect of interest income on its total reserves and in holding so, ignoring its own decision as also the judgments of the Rajasthan High Court and the Supreme Court."
4. At the time of hearing of the appeals, learned counsel for the parties agree that the controversy raised in these appeals is squarely covered by the decision dated November 29, 2000, of this court in ITR Nos. 48 and 49 of 1999 (Gujarat State Co-operative Bank Ltd. v. CIT [2001] 250 ITR 229 (Guj)).
5. In view of the above, we answer the question in the negative, i.e., in favour of the Revenue and against the assessee.
6. The appeals are accordingly dismissed. Since the appeals are dismissed, civil applications for stay are also dismissed.
7. At this stage, Mr. Soparkar for the assessee prays for a certificate under Section 261 of the Act for appeal to the Supreme Court and also prays for continuance of the ad interim relief which was granted earlier.
8. Since this case involves important questions of law of general importance for all the co-operative banks in India, we certify under Section 261 of the Act that this is a fit case for appeal to the Supreme Court.
9. At the request of Mr. Soparkar, we continue ad interim relief granted earlier till January 10, 2001. We make it clear that we are only extending the ad interim relief granted earlier.