TaxTMI 
TaxTMI 
2025 (9) TMI 1117
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.... disallowing deduction claimed under section 80P of the Act on 'SB interest' and 'other income' to the extent of Rs. 21,58,400/-. 4. Without prejudice to the above, the Learned CIT(A) and AO have erred in law in taxing gross receipt by ignoring the overriding principle in tax law that it is not the gross receipt that falls to be assessed but it is only the net income after all the expenditure to earn the income is deducted, that can be assessed to tax. 5. The Learned CIT(A) and AO have erred in not applying the principle of netting. 6. The Learned CIT(A) and AO impugned adjustments being merely based on presumption and surmises, are to be deleted. 7. The Learned CIT(A) and AO have erred in raising demand vide issue of notice under section 156 of the Act. 8. The Learned CIT(A) and AO has erred in levying interest under section 234Aand 234B of the Act. 9. The Learned AO has erred in initiating penalty proceedings by issuing of notice under section 270A of the Act. 10. The Learned AO has erred in initiating penalty proceedings by issuing of notice under section 271AAC of the Act. Grounds raised by the Re....
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.... demonetization period as per the gazette notification No.2652 dated 08.11.2016 that the Specified Bank Notes (SBN) shall seize to be legal tender w.e.f. 09.11.2016 and the assessee was not authorized to collect the SBNs in the currency of Rs. 500 and Rs. 1000. However, the assessee has accepted and deposited it into various bank accounts as under: Bank name E Account Number A) DEPA Total cash deposit -SBNs (in Rs.) ICICI, Amingad 650901000028 729500 BDCC, Banahatti 12002174 1707500 Axis Bank 93051 2760000 Canara Bank 57145 280500 ICICI, Bagalkot 610 2550000 BDCC Bank, Amingad 12002/108 1685000 Axis bank, Jamkhandi 939275 364500 TOTAL 10077000 LESS Cash balance as on 8/11/2016 156492 BALANCE TO BE CONSIDRED 9920508 4. In this regard, assessee submitted that these SBNs were received from members and deposited in their savings account, loan account, RD, pigmy, etc. maintained with the assessee by its members. It is not the money of the assessee. The money was deposited by its members and therefore the assessee did not got any benefit on the same. The AO treated the entire amount ....
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....Court in the case of Swabhimani Souharda Credit Co-operative Vs. UoI reported in (2020) 122 taxmann.com 37 (Karnataka) in which it has been held as under: "5. Having heard the learned counsel for the parties and having perused the petition papers, this Court is of a considered opinion that the answer to the above question needs to be in the affirmative for the following reasons: (a) sec. 80P of the 1961 Act provides for deduction in respect of income of Co-operative Societies is obvious going by its very text; sub-section (1) of said section reads as under: "80P. (1) Where, in the case of an assessee being a co- operative society, the gross total income includes any income referred to in sub-section (2), there shall be deducted, in accordance with and subject to the provisions of this section, the sums specified in sub-section (2) in computing the total income of the assessee." The other provisions of this section being not of much relevance to the question being treated, are not reproduced, although they too have been looked into. Sec. 2(19) which finds a place in the Dictionary Clause of the 1961 Act reads as under: 'co-op....
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....d brood through almost all the provisions of this Act; (d) the Karnataka Souharda Sahakari Bill, 1997 has the following as the Statement of Objects & Reasons: "1. the recognition, encouragement and voluntary formation of co-operatives based on self help, mutual aid, wholly owned, managed and controlled by members as accountable, competitive, self-reliant and economic enterprises guided by co-operative principles specified therein; 2. removing all kinds of restrictions that have come to clog the free-functioning of the cooperatives and the controls and interference by the Government except registration and cancellation; 3. promotion of subsidiary organization, partnership between co-operatives and also collaboration between co- operatives and other institutions; 4. registration of co-operatives, union cooperatives and Federal Co-operative in furtherence of the objectives specified above; 5. Conversion of co-operative societies registered under the Karnataka Co-operative Societies Act, 1959 as a co- operative under the proposed legislation. Hence the Bill." (e) the preamble to the 1959 Act reads as under: "Wherea....
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....djective but as a noun; the definition of other relative concepts in the dictionary clauses of these Acts strengthens this view; this apart, sec.7 of the 1997 Act provides that the entity registered as a 'co-operative' shall be a body corporate, notwithstanding the conspicuous absence of the word 'society' as a postfix; sec.9 of the 1959 Act makes the entity once registered u/s.8 thereof a body corporate; both the entities have perpetual succession by operation of law; thus on registration be it under the 1959 Act or the 1997 Act, a legal personality is donned by them, so that inter alia they can own and possess the property; (f) the employment of the word "Sahakari" in the very title of the 1997 Act is also not sans any significance; 'Sahakaar' in Sanskrit is the equivalent of 'sahakaara' in Kannada which means 'co-operation'; as already mentioned above both the 1959 Act and the 1997 Act employ this terminology; the 1997 Act is woven with the principles of co-operation; sec.4 of this Act bars registration of an entity unless its main objects are to serve the interest of the members in the area of co-operation and its bye-laws provid....
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....at CBDT has framed SOP for completing assessment of cash deposit accounts titled as `Operation Clean Money'. As per SOP, ultimate beneficiary of cash transactions should be established and the AO were instructed to forward such information to his counterpart who has jurisdiction over such beneficiary and such AO will carry on the assessment on such ultimate beneficiary. Appellant further submitted that it has accepted such amount in their fiduciary capacity as per the aims and objects of the society and cash deposited in the bank account is not owned by society. Thereby, appellant submitted that it has explained the nature, source of amount received from member who are KYC compliant and maintained books of account and recorded the cash received in the accounts. Appellant also submitted that statement showing month-wise cash deposit in bank accounts for the entire financial year 2016-17 which consist of demonetization period. As per SOP, if there is abnormal increase in cash deposit in bank account during demonetization period then in such cases the officers were instructed to prove and complete assessment accordingly. However, AO made addition u/s.68 of the Act by making observ....