2014 (6) TMI 219

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....nder consideration in its return of income claimed deduction u/s.80P(2) of the Income Tax Act, 1961 (herein after referred to as 'the Act'). The Assessing Officer in scrutiny assessment proceedings held that the assessee is registered under the Societies Act as Co-operative Bank and is engaged in the activities akin to commercial banking and has earned income at par with other commercial banks. The Assessing Officer held that the assessee is not eligible to claim deduction u/s.80P of the Act. Aggrieved against the assessment order dt.28-11-2011, the assessee preferred an appeal before the CIT(Appeals). The CIT(Appeals) vide impugned order held that the exemption u/s.80P is available to co-operative societies engaged in the business of prov....

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....uarely covered by the decision of the coordinate bench of the Tribunal in ITA No.292/Mds/2014 in the case of M/s.SL(SPL) 151, Karkudalpatty Primary Agricultural Cooperative Credit Society Ltd., Vs. ITO decided on 17-03-2014. In the said case, the Tribunal has held that for availing deduction u/s.80P, classification of Members in 'A' and 'B' is irrelevant. The ld.AR also placed on record a copy of the order of the Tribunal in ITA No.197/Mds/2013 in the case of ITO Vs. M/s.Veerakeralam Primary Agricultural Co-operative Credit Society decided on 11-02-2014, wherein the Tribunal had held that the activities of primary agricultural co-operative credit societies are not at par with co-operative banks. 4. On the other hand, Shri Anirudh Rai, appe....

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.... the reason, that credit facilities have been extended to a particular class of Members, who are not normal Members of the society. We do not agree with the CIT(Appeals) on the issue. The authorities under the Act cannot go beyond their jurisdiction and make classification within a classification of Members to deny the benefit of deduction. The co-ordinate bench of Tribunal in the case of M/s.SL(SPL) 151, Karkudalpatty Primary Agricultural Cooperative Credit Society Ltd., Vs. ITO (supra) has dealt with this issue. The findings of the Tribunal are as under:  "7. We have heard both parties and gone through the case file. As stated in the preceding paragraphs, the CIT(A) has proceeded to enhance the assessment(supra) only on the ground t....