TaxTMI 
TaxTMI 
2016 (4) TMI 644
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....201(1A) of the Income Tax Act, 1961 (in short 'the Act') for the Assessment Years 2012-13 and 2013-14 respectively. 2. The assessee is a co-operative society and engaged in the banking services. There was a survey under Section 133A at the business premises of the assessee on 13.11.2013. During the course of survey, the Assessing Officer noticed that the assessee has deducted tax at source from the interest paid to non-members but has failed to deduct the tax at source from the interest paid to its own members and to the co-operative societies without obtaining declaration in Form No.15G/15H from them. Accordingly, the Assessing Officer determined that the assessee was liable for default in deducting tax at source as well as inte....
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....e bench of this Tribunal vide order dt.30.5.2014 in the case of Bagalkot Central District Co-operative Society (supra) wherein the Bench has held that co-operative society carrying on banking business need not to deduct tax at source under Section 194A in respect of the interest paid to members on deposits by virtue of exemption granted vide clause (v) of the sub-section (3) of the said section. The learned Authorised Representative of the assessee has pointed out that in the subsequent decision dt.20.3.2015, this Tribunal in the case of ITO Vs. Hubli Urban Co-operative Bank Ltd. in ITA Nos.1191 to 1194/Bang/2014 has again reiterated the same view by following the decision in the case of The Bagalkot District Central Co-operative Bank (supr....
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.... 2.3 The following chart explains the position: Type of Interest / Payee Rs. 10,000 or less 1 94A(3)(i)(b) Any Amount/Any type of interest paid by a Co-op Society 194A(3)(v) Interest on deposits other than timedeposits 194A(3)(viia)(b) Interest on time deposit 194A (3)(v) Member Exempt Exempt Exempt Exempt Non- Member Exempt TDS to be made Exempt TDS to be made According to him the above chart would clearly show that when a cooperative society is paying interest to its members, it need not deduct tax at source. It was his submission that the Assessee is a co-operative society registered under the Mysore Co-operati....
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....ed 11.9.2002 (257 ITR St 36). In this circular the Board has clarified as under: "Board has considered the matter and it is clarified that a member of a co-operative bank shall receive interest on both time deposits and deposits other than time deposits where such co-operative bank without TDS under Section 194A by virtue of exemption granted vide clause (v) of sub-section (3) of the said section. The provisions of clause (viia) of the said sub-section are applicable only in case of a non-member depositor of the cooperative bank, who shall receive interest only on deposits other than time deposits made on or after July 1, 1995 without TDS under section 194A". It was also submitted by him that the learned Assessing Officer ....