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TMI Blog2015 (8) TMI 1034X X X X Extracts X X X X X X X X Extracts X X X X ..... the facts of the case, we do not see any reason to disallow the deduction under section 80P. The Revenue has raised the grounds that the provisions under section 80P(4) were applicable to the assessee. We do not see any reason to consider this ground as the restrictions brought out subsequently under section 80P(4) is applicable in the case of a co-operative bank not a co-operative society. - Decided against revenue. - I.T.A Nos. 1328, 1329 & 1330/HYD/2012, I.T.A. No. 1448/HYD/2013 - - - Dated:- 4-3-2015 - SHRI B. RAMAKOTAIAH AND Smt. ASHA VIJAYARAGHAVAN, JJ. For the Appellant : Shri Rama Krishna Bandi, DR For the Respondent : Shri K.A. Sai Prasad, AR ORDER These are the Revenue's appeals filed against the orders of the Commissioner of Income-tax (Appeals)-VI, Hyderabad, for the assessment years (AYs) 2007-08, 2008-09, 2009-10 and 2010-11. There was a common order by the Commissioner of Income-tax (Appeals)-VI, Hyderabad, dated June 1, 2011, for the assessment years 2007-08 to 2009-10 whereas the Commissioner of Income-tax (Appeals)-VI, has passed the order in the assessment year 2010-11 dated July 20, 2013. Since common issues are involved, these appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ive bank. The detailed order of the Commissioner of Income-tax (Appeals) in paragraph Nos. 5.4 to 5.8 is as under : 5.4 The Income-tax Appellate Tribunal, Bangalore in the decision cited by the assessee has laid down the following difference between a co-operative bank and a co-operative society : Nature Co-operative society registered under the Banking Regulation Act, 1949. Co-operative society registered under the Karnataka Co-operative Society Act, 1959. Registration Under the Banking Regulation Act, 1949 and the Co-operative Societies Act, 1959. Co-operative Societies Act, 1959. Nature of business 1. As defined in section 6 of Banking Regulation Act. 1. As per the bye laws of cooperative society. 2. Can open savings bank account, current account, overdraft account, issue letter of credit, discounting bills of exchange, issue cheques, demand drafts (DD), pay orders, gift cheques, lockers, bank guarantees, etc. 2. Society cannot open savings bank account, current accou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e society engaged in the business of providing credit facility to its members, and that it is not a co-operative bank. 5.7 The Income-tax Appellate Tribunal, Bangalore, has held in the case of Bangalore Commercial Transport Credit Co-operative Society Ltd. : 'If the intention of the Legislature was not to grant deduction under section 80P(2)(a)(i) to co-operative societies carrying on the business of providing credit facilities to its members, then this section would have been deleted. The new provision to section 80P(4) which is brought into statute is applicable to co-operative banks and not to credit co-operative societies. The intention of the Legislature to bring co-operative banks into the taxation structure was mainly to bring in par with commercial banks. Since the assessee is a co-operative society and not a co-operative bank, the provisions of section 80P(4) will not have applicable in the assessee's case and therefore it is entitled for deduction under section 80P(2)(a)(i) of the Act.' 5.8 Respectfully following the decision of the Income-tax Appellate Tribunal and on the basis of the facts in the case of the present asses see, the Assessing Officer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns a society having its area of operation confined to a taluk and the principal object of which is to provide for long-term credit for agricultural and rural development activities.' 22.1. As per this section, the exemption provided under sub-section (2) or sub-section (3) does not apply to the incomes of the co-operative bank other than a primary agricultural co-operative society or a primary co-operative agricultural and rural development bank. However, the above provision applicable in the case of co-operative bank is not in respect of interest received from co-operative banks by a cooperative credit society/co-operative society. Section 80P(2)(d) is applicable to the assessee-society in respect of incomes by way of interest or dividends received by the co-operative society from its investments with any other co-operative society. Therefore, in the case of the assessee-society, sub-section (4) is not applicable and deduction under section 80P(2)(d) is certainly eligible to the assessee. In the assessment of a co-operative bank, the incomes may not be exempt after April 1, 2007, by virtue of sub-section (4), but the assessee is not a co-operative bank. Therefore, the Reven ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Bangalore Commercial Transport Credit Cooperative Society Ltd. (I. T. A. No. 1069/Bang/ 2010, dated April 8, 2011), wherein it was clarified that the new proviso to section 80P(4) which is brought into statute, is applicable only to co-operative banks and not credit co-operative societies. Considering the finding given by the Income-tax Appellate Tribunal, Bangalore (supra), it is held that the appellant-society being a cooperative credit society is eligible for deduction under section 80P(2)(a)(i). However, it may be relevant to note that in this case, while furnishing the return of income, the appellant claimed deduction of ₹ 1,72,46,463 under section 80P(2)(a)(i) which was disallowed by the Assessing Officer. The said deduction is recomputed in the revised computation at ₹ 1,66,13,779, which is as under, which appears to be based on the correct facts/information. (Rs.) (a) Gross/total receipts 5,35,97,746 (i) Business receipts 3,82,77,265 (ii) Other sources ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8377; 1,72,46,463 and by including the deduc tion under section 80P(2)(a)(i) to the extent of ₹ 1,66,13,779 and ₹ 7,03,784, in the revised computation, the total claim made by the appellant (1,66,13,739 + 7,03,784) amounted to ₹ 1,73,17,523 which exceeds the total claim made in the original return of income (Rs.1,72,46,463). Thus, the claim of the deduction under section 80P(2)(a)(i) and the claim for deduction under section 80P(2)(d) is restricted to the total amounts of deduction of ₹ 1,72,46,463, as claimed in the original return of income, in order to avoid the situation that the assessed income is less than the returned income. 7. The appellant made the additional claim of deduction under section 80P(2)(c) being eligible for deduction, as cooperative credit society, which was omitted to be claimed in the original return of income. Though, on facts the appellant is eligible for deduction under section 80P(2)(c), for the reasons mentioned for restricting the allowance under section 80P, wherein the claims made in revised computation/grounds of appeal exceeds the claims made while furnishing the return of income, the additional claim of the appellant is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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