TaxTMI 
TaxTMI 
2019 (11) TMI 1832
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....duction claimed by the Assessee under section 80(P)(2)(a)(i) for reasons which are arbitrary, impermissible and beyond what is provided under law. Rs.12,49,430/- approximately plus applicable Interest 3. That the Ld CIT (A) erred in confirming the order of AO and denying the deduction under section 80(P)(2)(a)(i), and in doing so: a) She failed to appreciate that the business of the Appellant consists entirely of extending credit facilities to its members as given under section 80(P)(2)(a)(i). b) She failed to appreciate that cooperative society defined under section 2(19) of the Income Tax Act includes societies registered under "Karnataka Souharda Sahakari Act, 1997" inasmuch as they also operate and adopt the principle of cooperation as required under the Act. c) She failed to consider the decisions of Honourable Jurisdictional High Court and the ITAT in favour of Appellant. Same as Ground 2 above since they are on the same issue The appellant prays for leave to add, delete, modify and/or adduce additional ground at any time before the appeal is disposed off. For these and such other grounds that may be adduced or removed in time to time, it is requested that the....
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.... Ltd. vs. ITO (Supra) was duly considered and thereafter, it was held that Souharda Co Operatives are also one form of Co Operative Society registered under a law in force in the State of Karnataka for registration of Co Operative Societies and therefore, denial of deduction u/s 80P to such societies on the ground on which the same was denied is incorrect but the other conditions for allowing deduction u/s 80P needs to be examined and the matter was restored to AO for a fresh decision except on the issue already decided i.e. the eligibility of Souharda Co Operative for deduction u/s 80P. He submitted that in the present case also, this issue should be decided in favour of the assessee and thereafter, the matter may be restored to AO to decide the allowability of deduction u/s 80P in view of other conditions of section 80P. 4. As against this, learned DR of the revenue submitted that the earlier tribunal order rendered in the case of Udaya Souharda Credit Co Operative Society Ltd. vs. ITO (Supra) is an order passed by the Division Bench of the tribunal but the later tribunal order rendered in the case of Siddartha Pattina Souharda Sahakari Niyamitha vs. ITO (Supra) is an order pass....
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....operative societies ;" 7. As can be seen from the aforesaid definition of 'Co-operative society' under the Act, any co-operative society registered under any other law of any State for registration of co-operative society is also regarded as co-operative society under the Act. Souhardas' also operate on the principle of co-operation and adopt the principles of co-operation. Cooperative Societies and Co-operatives are all founded on the principle of cooperation. 8. Since the beginning of mankind the concept of 'co-operation' has been the foundation for harmonious existence In India, the Cooperative Societies Act 1912 regulated formation, management, winding up and other supervision by the Government etc. This Act became the model for the provincial governments to form their own Cooperative Acts. Post-Independence, various state governments framed their own independent Cooperative Acts and the Central Government its Multi-State Cooperative Act. Accordingly, Karnataka State Cooperative Societies Act, 1959 (KSCS Act, 1959) regulates Cooperative societies in the state of Karnataka. A Panchayat, a Cooperative society and a School for every village were considered as the three pilla....
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....trolled by members as accountable, competitive self-reliant and economic enterprises guided by co-operative principles and for matters connected therewith; BE it enacted by the Karnataka State Legislature in the Forty-eighth Year of Republic of India as follows:- " 10. The Souharda Cooperatives enjoy functional autonomy in design and implementation of their Business plans, customer service activities, etc., based on the needs of their members. Unlike other forms of cooperatives in India, the interference of State / Central in day-to-day operations of Souharda Cooperatives is almost minimal. 11. The above discussion would show that souharda co-operatives are also one form of co-operative societies registered under a law in force in the State of Karnataka for registration of co-operative societies. Therefore, the conclusion of the revenue authorities that co-operative societies and co-operatives are different and that co-operative registered as Souharda Sahakari cannot be regarded as co-operative societies is unsustainable. We therefore hold that the Assessee should be allowed deduction u/s. 80P(2)(a)(i) of the Act, as the ground on which the same was denied to the Assesse....