2002 (2) TMI 32

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....the order of the Income-tax Appellate Tribunal. The basic question for consideration in this appeal is whether the assessee-society is entitled for the benefit of deduction under section 80P(2)(a)(ii). The assessee is a co-operative society engaged in the marketing of the produce of members of primary society and to supply the members of primary society raw material for manufacturing through th....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....Court reported in Addl. CIT v. Hastkala Pital Udyog Sahkari Samiti Ltd. [1978] 114 ITR 723 (Appex.). The Tribunal has also considered the decision of the Madhya Pradesh High Court in the case of CIT v. Madhya Pradesh State Handloom Weavers Co-operative Society Ltd. [1998] 231 ITR 243. Finally, the Tribunal has relied on the decision of the Supreme Court in the case of Kerala State Cooperative Mark....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....not the members of the member society. If the weavers are the members of the member society, then the apex body of the society is not entitled for benefit of deduction under section 80P(2)(a)(ii). Whether the assessee-society is entitled for benefit of the exemption under section 80P(2)(a)(ii), we have to consider its activities and objects. The assessee-society is a co-operative society engage....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....s, in these circumstances, it cannot be said that the assessee-company is not engaged in the manufacturing activities carried on by the weavers. The weavers get the raw material, i.e., yarn, through their primary society, but thereafter weaving charges are paid by the assessee and it purchases those cloths through the primary societies. When the society has full control over the manufacturing a....