TaxTMI 
TaxTMI 
1984 (1) TMI 121
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....f banking by providing credit facilities to its members. The assessee constructed a building to house the bank and the administrative offices. Surplus space in the building was let out. The assessee returned a net amount of Rs. 29,139 for the assessment year 1978-79 and Rs. 20,564 for the assessment year 1979-80 by way of income from property and claimed out of the same a deduction of Rs. 20,000 for each assessment year under section 80P(2)(c). 4. Section 80P relates to deduction in respect of income of co-operative societies. Under clause (a) of sub-section (2) profits and gains attributable to the activities enumerated in the clause are totally exempted. Similarly, under clause (b) the profits and gains of business attributable to the s....
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.... do not use the expression ' profits and gains ' and only use the expression ' income '. Further the letting out of portion of the building of the assessee will not amount to an activity. Clauses (d), (e) and (f) of sub-section (2) of section 80P use the word 'income' with reference to income arising from dividends, letting out of godowns, interest on securities, etc. This clearly indicates that the words ' profits and gains ' used in clauses (a) to (c) related to an income from business activity. 6. As against this, it is contended by the learned representative for the assessee that although it is a fact that the words ' profits and gains ' have been used in clause (c), they are used in conjunction with the word ' activity ' and that thi....
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....ivity. The only dispute was whether the interest received from the investment of a portion of the profit gained by the activity can be brought under clause (c) for claiming exemption. It was in this connection that it was held that the words ' attributable to ' are much wider than the expression ' derived from '. The ratio of the decision is that although the interest income is not actually derived from the activity of supplying sugarcane, it is attributable to the activity of supplying sugarcane. In the present case, even assuming that the letting out of the surplus space by the assessee is an activity, we are unable to hold that the proceeds therefrom can be called ' profits and gains '. In the case before the Allahabad High Court referre....
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....ction 80P itself. Clauses (d), (e) and (f) which deal with income from interest or dividends, income from letting of godowns or warehouses and income from securities and house property, the word used is ' income ' and not ' profits and gains '. The closing portion of clause (f) furnishes a complete answer to the controversy. The reference in the closing portion is to ' any income from house property chargeable under section 22 '. Section 80P, therefore takes notice of income from house property. It not only uses the word ' income ' in connection with the same but specifically deal with the same under clause (f) income from house property will be exempt only where the gross total income of the society does not exceed Rs. 20,000. In view of t....