TaxTMI 
TaxTMI 
2019 (5) TMI 1189
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....78/Coch/2019, ITA No.79/Coch/2019, ITA No.81/Coch/2019 - -<br>Income Tax<br>The Income Tax Officer Trivandrum. Versus M/s.Attingal Municipal Town Service Co-operative Bank Ltd., M/s.Kadakkal Service Cooperative Bank Ltd., M/s.Pallickal Farmers Service Co-operative Bank Ltd., M/s.Pazhayakunnummel Service Co-operative Bank Ltd., M/s.Edava Service Co-operative Bank Ltd., M/s.Vembayam Service Co-operative Bank Ltd., M/s.Vithura Service Co-operative Bank Ltd., M/s.The Nadakkal Service Co-operative Bank Ltd., M/s.The Uliyakovil Service Co-operative Bank Ltd., M/s.The Adichanalloor Farmers Service Co-operative Bank Ltd., M/s.Anad Farmers Service Co-operative Bank Ltd. And M/s.Naruvamoodu Service Co-operative Bank Ltd. ITA No.94/Coch/2019, ITA N....
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.... deduction claimed u/s 80P of the I.T.Act. The Assessing Officer for denying the claim of deduction u/s 80P of the I.T.Act, treated the assessees as a co-operative bank and not a co-operative society. Further the interest received from the investments were denied deduction u/s 80P of the I.T.Act by treating the same as income from `other sources'. 4. Aggrieved by the orders of the assessment, the assessees filed appeals before the first appellate authority. The CIT(A) by following the judgment of the Hon'ble jurisdictional High Court in the case of Chirakkal Service Co-operative Bank Ltd. (384 ITR 490) allowed the claim of deduction u/s 80P of the I.T.Act. As regards interest received on investments, the CIT(A) held that the same should ....
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....) the order of CIT(A) deleting the additions made during the completion of assessment as per the provisions of Income tax Act, considering the provisions of section 80P(4) is correct? (ii) the order of CIT(A) is correct in not duly considering that the interest income received from deposits made with banks cannot be attributable as profit and gains from out of providing credit facilities to its members u/s 80P(2)(a)(i)? (iii) the order of CIT(A) is correct in not duly considering that the assessee has invested surplus funds like an ordinary investor and the interest income from such deposits has to be tax income from other sources and not eligible for deductor 80P? (iv) the order of CIT(A) is correct in not duly c....
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....isdictional High Court in the case of The Mavilayi Service Co-operative Bank Ltd. V. CIT [ITA No.97/2016 order dated 19th March, 2019]. The learned AR relied on the orders of the CIT(A). 7. We have heard the rival submissions and perused the material on record. The Larger Bench of the Hon'ble jurisdictional High Court in the case of The Mavilayi Service Co-operative Bank Ltd. (supra) held that the Assessing Officer has to conduct an inquiry into the factual situation as to the activities of the assessee society to determine the eligibility of deduction u/s 80P of the I.T.Act. It was held by the Hon'ble High Court that the Assessing Officer is not bound by the registration certificate issued by the Registrar of Kerala Co-operative Society....
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....gricultural purposes, the rate of interest on such loans and advances to be at the rate to be fixed by the Registrar of Co-operative Societies under the KCS Act and having its area of operation confined to a Village, Panchayat or a Municipality and as such, they are entitled for the benefit of sub-section (4) of Section 80P of the IT Act to ease themselves out from the coverage of Section 80P and that, the authorities under the IT Act cannot probe into any issues or such matters relating to such societies and that, Primary Agricultural Credit Societies registered as such under the KCS Act and classified so, under the Act, including the appellants are entitled to such exemption. 34. In Chirakkal [384 ITR 490] the Division Bench expr....
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....Assessing Officer. The Assessing Officer shall examine the activities of the respective assessees and determine whether their activities are in compliance with the activities of a co-operative society functioning under the Kerala Co-operative Societies Act, 1969 and grant deduction u/s 80P(2) in accordance with law. 8. As regards the interest on the investments with Cooperative Banks and other Banks, the co-ordinate Bench order of the Tribunal in the case of Kizhathadiyoor Service Cooperative Bank Limited (supra) held that interest income earned from investments with treasuries and banks is part of banking activity of the assessees, and therefore, the said interest income was eligible to be assessed as `income from business' instead of `....