2015 (4) TMI 621

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..... While admitting these appeals, the Court had formulated the following substantial questions of law:­ "1. Whether, in the facts and circumstances of the case, the ITAT was right in law in holding that the amount transferred to reserve fund account as per the provisions of Sec.67 of Gujarat State Co­operative Societies Act was not a diversion of income at source by overriding title ? 2. Whether, on the facts and in the circumstances of the case, the ITAT was right in law in holding that the transfer t....

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....as the facts and questions of law involved in this appeal are identical to ITR No.65 of 1997. The question of law raised in ITR No.65 of 1997 reads as follows:­ "1. Whether, in the facts and in the circumstances of the case, the Appellate Tribunal was right in law in holding that the amount transferred to reserve fund account as per the provisions of Sec.67 of Gujarat State Co­operative Societies Act, 1967 was not a diversion of income at source by over­riding title ? 2. Whether, on the facts and in the circumstances of the case, the Appella....

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....p;(supra). Furthermore, as can be seen from provisions of Section 67(2) of the CoPage operative Societies Act the question of control of the State Government by specifying the mode of investment or the mode of use of the reserve fund can arise only in the eventuality when the society does not use the reserve fund in the business of the society. The opening portion of sub­section (2) of Section 67 of the Co­operative Societies Act specifically provides ... and such reserve fund may be used in the business of the society or ..... In other words, it is only i....