TaxTMI 
TaxTMI 
2018 (2) TMI 1820
X X X X Extracts X X X X
X X X X Extracts X X X X
....n under section 80P(2)(a)(i) of the Income Tax Act, 1961 ["Act" in short]. 2. Brief facts of the case are that the assessee is "Primary Agricultural Co-operative Credit Society" registered under "Tamilnadu Co-operative Societies Act". It is also engaged in the business of trading in PDS commodities. The assessee filed its return admitting NIL income and claimed deduction under section 80P(2)(a)(i) of the Act to the tune of Rs..3,64,73,662/- and 80P(2)(d) of the Act of Rs..30,97,475/- and restricted both the deduction to Rs..3,83,82,362/- from the "income chargeable under the head business and profession". The return filed by the assessee was processed under section 143(1) of the Act. Subsequently, the case of the assessee was selected for ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ials available on record and gone through the orders of authorities below. Even though the issue raised in this appeal and facts are similar to that of the decisions of the Hon'ble Jurisdictional High Court decided in various assessee's case including assessee's own case for the assessment year 2011-12, since the Department has not accepted the judgement of the Hon'ble High Court and preferred SLP before the Hon'ble Supreme Court, the Assessing Officer made the disallowance on the claim of deduction under section 80P(2)(a)(i) of the Act. Before us, the ld. DR strongly relied on the decision in the case of The Citizen Cooperative Limited v. ACIT (supra), wherein, the Hon'ble Supreme Court decided the appeal against the assessee. We have peru....
X X X X Extracts X X X X
X X X X Extracts X X X X
....pointed out that acceptance of deposits from its members in cash and withdrawal thereof by them in cash would violate the provisions of sections 269SS and 269T of the Act. sections 269SS and 269T of the Act relate to mode of taking or accepting certain loans and deposits and their repayment respectively. (iii) The assessee as Co-operative Society and assessee under PAN No. AAAAT3952F had filed return of income before Assistant Commissioner of Income Tax, Circle-9(I), Hyderabad for the Assessment Year 2009-10, for the year ending March 31, 2009 on September 30, 2009 declaring NIL income. In the return filed for the Assessment Year 2009-10, year ending with March 31, 2009, the assessee claimed a sum of Rs. 4,26,37,081/- as deduction under S....
X X X X Extracts X X X X
X X X X Extracts X X X X
....so to the aforesaid provision, it is made clear that such a deduction shall not be admissible to a co-operative bank. However, if it is a primary agriculture credit society or a primary co-operative agriculture and rural development bank, the deduction would still be provided. Thus, co-operative banks are now specifically excluded from the ambit of Section 80P of the Act. 24) Undoubtedly, if one has to go by the aforesaid definition of 'co-operative bank', the appellant does not get covered thereby. It is also a matter of common knowledge that in order to do the business of a co-operative bank, it is imperative to have a licence from the Reserve Bank of India, which the appellant does not possess. Not only this, as noticed above, the Rese....
X X X X Extracts X X X X
X X X X Extracts X X X X
....stinct. In reality, such activity of the appellant is that of finance business and cannot be termed as co-operative society. It is also found that the appellant is engaged in the activity of granting loans to general public as well. All this is done without any approval from the Registrar of the Societies. With indulgence in such kind of activity by the appellant, it is remarked by the Assessing Officer that the activity of the appellant is in violation of the Cooperative Societies Act. Moreover, it is a co-operative credit society which is not entitled to deduction under Section 80P(2)(a)(i) of the Act. 26) It is in this background, a specific finding is also rendered that the principle of mutuality is missing in the instant case. Though....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ep the aforesaid aspects in mind, the conclusion is obvious, namely, the appellant cannot be treated as a co-operative society meant only for its members and providing credit facilities to its members. We are afraid such a society cannot claim the benefit of Section 80P of the Act." 6.2 On carefully going through the above facts and observations of the Hon'ble Court, we find that the above judgement of the Hon'ble Supreme Court has no application to the facts of the present case. Because, in the present assessee's own case for earlier assessment years, the Coordinate Benches of the Tribunal has clearly held that the assessees are not cooperative bank and that their activities in the nature of accepting deposits, advancing loans etc., carri....