TaxTMI 
TaxTMI 
2021 (8) TMI 1
X X X X Extracts X X X X
X X X X Extracts X X X X
.... facilities to its members (mainly agricultural loans), distribution of food grains and other products under State Govt's Public Distribution System, sale of fertilizers / pesticides etc., to farmers. 3. The assessee filed its return of income for the Assessment Year 2016-17 on 14-10-2016 declaring a total income of Rs. 64,060 after claiming deduction of Rs. 1,92,69,544 u/s 80P(2)(d) of the Act. Thereafter, the assessee's case was selected for scrutiny under CASS and notice u/s 143(2) was issued by the AO on 04-072017. During the course of the assessment proceedings, the assessee submitted a revised Statement of Income declaring a Gross Total Income of Rs. 2,17,53,604 and Total Income of Rs Nil, after claiming a Deduction of Rs. 2,17,5....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... AO ought to have appreciated the fact that the bye laws of the assessee Society and the Karnataka Co Operative Societies Act, 1959 under which the assessee is registered, permits the admission of such class of members and the assessee has not violated the law by admitting Nominal Members. Thus, the total income of the assessee was computed at Rs. 1,93,33,604 and tax thereon including interest was levied by the AO at Rs. 88,72,171/-. 8. On appeal by the assessee, the CIT(A) confirmed the order of the AO by placing reliance on the decision of the Hon'ble Supreme Court in the case of Citizens Co-operative Society Ltd. Vs. ACIT 397 ITR 1 (SC). Aggrieved by the order of the CIT(A), the assessee has preferred the present appeal before the Tribu....
X X X X Extracts X X X X
X X X X Extracts X X X X
....in the decision rendered by it in the case of Mavilayi Service Co-operative Bank Ltd. (supra) and since the facts prevailing in the instant case needs to be examined afresh in the light of the principles enunciated by Hon'ble Supreme Court in the above said case, we are of the view that the issue of deduction u/s 80P(2)(a)(i) of the Act requires fresh examination at the end of the A.O. Accordingly, we set aside the order passed by Ld. CIT(A) for the year under consideration and restore them to the file of the A.O. for examining it afresh as discussed above. 11. As far as ground Nos.6 to 8 are concerned, we have heard the rival submissions. In the case of Karkala Co-op. S. Bank Ltd. Vs. ITO (ITA No.1288 8r, 1289/Bang/2019 dated 18.2.202....
X X X X Extracts X X X X
X X X X Extracts X X X X
....claim claim before Hon'ble Supreme Court in the case reported as Totgars Co-operative Sale Society Ltd. Vs. ITO (2010) 188 taxmann.com 282 and the Hon'ble Supreme Court, vide 14 of its order, had restored the question raised by the assessee to the file of Hon'ble High Court of Karnataka. Consequent thereto, the Hon'ble High Court of Karnataka has passed the order in the case reported in 58 taxmann.com 35 and held that the Tribunal was not right in coming to the conclusion that the interest earned by the appellant is an income from other sources without allowing deduction in respect of proportionate cost, administrative expenses incurred in respect of such deposits. Accordingly, the Ld. A.R. prayed that the A.O. may be d....