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TMI Blog2014 (11) TMI 148X X X X Extracts X X X X X X X X Extracts X X X X ..... society, providing credit facilities to its members and not a Bank under Banking Regulation Act - It does not have license to act as Bank and the object of society is to help its members only and hence deduction under Section 80P(2)(a)(i) cannot be denied – assessee in the stay petition has specifically raised that the decision of the Hon'ble Gujarat High Court is fully in their favour - Therefore, they have raised the issue to establish prima facie case - they are not doing banking activities and they do not fall within the definition of banking as defined under Section 5(b) of the Banking Regulation Act, nor do they possess license u/s 22 of the said Act, which is the mandatory requirement - As per the clarification issued by the CBDT dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to 2011-2012. Since the scope of these writ petitions is narrow, it may not be necessary to go into the factual details of each and every assessment order and the pattern of orders of assessment for 5 years are also identical. 5. The assessments were completed under Section 143(3) r/w Section 147 of the Income Tax Act, disallowing the claim of deduction under Section 80P(2)(a)(i) of the Income Tax Act, on the ground that the Co-operative Society provides credit facility to its members and the petitioner's Society is carrying on business of banking and hence, not eligible for deduction under Section 80P(4) of the Income Tax Act. Aggrieved by the disallowance, the petitioner Society preferred appeals before the Commissioner of Income T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... missioner of Income Tax VIII / 3rd respondent herein, vide order dated 18.09.2014, observed that stay of demand cannot be granted unless there is a case of financial stringency and also filing of appeal before the CIT (A) cannot be a valid ground for deferring the recovery proceedings, which order was followed by the proceedings of the Joint Commissioner of Income Tax, Vellore Range, Vellore dated 11.09.2014, wherein the petitioner was directed to pay the entire demand immediately stating that mere filing of appeal is not an excuse for non payment of tax dues and if the appeal is decided in favour of the petitioner, the department would not hold the refund due to them as a result of order giving effect to the appellate order and the same ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion of the Gujarat High Court in the case of CIT vs. Jafari Momin Vikas Co-operative Credit Society Ltd., (Guj), reported in (2014) 362 ITR 331 (Guj). The petitioner pointed out that during the course of assessment, the petitioner has submitted that it is a co-operative credit society, providing credit facilities to its members and not a Bank under Banking Regulation Act. It does not have license to act as Bank and the object of society is to help its members only and hence deduction under Section 80P(2)(a)(i) cannot be denied. By relying upon Section 5(b) of the Banking Regulation Act, it was contended that the petitioner Society is not a Bank and they do not hold license as required under Section 22 of the Banking Regulation Act. Therefo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll be put an irreparable hardship and therefore, requested for grant of stay. 10. It is to be noted that the petitioner in the stay petition has specifically raised that the decision of the Hon'ble Gujarat High Court is fully in their favour. Therefore, they have raised the issue to establish prima facie case. That apart, the specific case of the petitioner is that they are not doing banking activities and they do not fall within the definition of banking as defined under Section 5(b) of the Banking Regulation Act, nor do they possess license under Section 22 of the said Act, which is the mandatory requirement. As per the clarification issued by the CBDT dated 01.12.2009, detailed instructions have been given as to how and under what ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the said decision has not been considered, the petitioner has duly established the prima facie case. 11 (ii) The next aspect to be considered is whether balance of convenience is in favour of the petitioner Society. If the decision of the Hon'ble Gujarat High Court is said to be applicable to the case of the petitioner, then obviously balance of convenience is in their favour. Further contention is that the petitioner Society is not doing banking business and therefore, they do not fall within the definition of banking as defined under Section 5(b) of the Banking Regulation Act, nor do they possess license for carrying on business. It is also a good ground to consider the balance of convenience in their favour. 11(iii). The next ..... X X X X Extracts X X X X X X X X Extracts X X X X
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