2014 (1) TMI 1690

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....d on facts, the ITAT is justified in holding the assessee entitled to claim deduction under section 80P (2) ?" [B] "Whether in law and on facts, the ITAT is justified in holding that the assessee is not covered within the purview of Section 80P (4) of the Act ?" The issue pertains to deduction under section 80P (2) of the Act. Revenue contended that by virtue of amendment in subsection (4) of Section 80P, the respondent assessee which is a cooperative credit society other than primary agricultural credit society would not be entitled to deduction. However, recently in our Order dated 15th January 2014 in Tax Appeal No. 863 of 2013, we have examined similar question and rejected the Revenue's appeal, making following observations : ....

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.... the present form refers as under:( 4) The provisions of this section shall not apply in relation to any cooperative bank other than a primary agricultural credit society or a primary cooperative agricultural and rural development bank. Explanation-For the purposes of this subsection, ( a) cooperative bank and primary agricultural credit society shall have the meanings respectively assigned to them in Part V of the Banking Regulation Act, 1949(10 of 1949); (b) primary cooperative agricultural and rural development bank means a society having its area of operation confined to a taluk and the principal object of which is to provide for longterm credit for agricultural and rural development activities. 4. As per section 80P(4), ....

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....ion. However, the issue has been considerably simplified by virtue of CBDT circular No.133 of 2007 dated 9.5.2007. Circular provides as under:Subject: Clarification regarding admissibly of deduction under section 80P of the IncomeTax Act, 1961. 1. Please refer to your letter no.DCUS/30688/2007, dated 28.03.2007 addressed to Chairman, Central Board of Direct Taxes, on the above given subject. 2. In this regard, I have been directed to state that subsection( 4) of section 80P provides that deduction under the said section shall not be allowable to any cooperative bank other than a primary agricultural credit society or a primary cooperative agricultural and rural development bank. For the purpose of the said subsection, cooperative bank....