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TMI Blog2015 (10) TMI 593X X X X Extracts X X X X X X X X Extracts X X X X ..... its return of income for A.Y. 2007-08 on 02.11.2007 declaring total income at Rs. Nil. The case was selected for scrutiny and thereafter the assessment was framed under section 143(3) vide order dated 24.12.2009 and the total income was determined at Rs. 5,35,780/-. Aggrieved by the order of A.O., Assessee carried the matter before ld. CIT(A) who vide order dated 09.12.2010 dismissed the appeal of the Assessee. Aggrieved by the order of ld. CIT(A), Assessee is now in appeal before us and has raised the following grounds:- 1. The Ld. CIT(A) has grossly erred in law and on the facts of the case in confirming the action of the Id. AO in treating the Appellant as the cooperative bank and accordingly erred in law in applying sub-section (4) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... banking it was not eligible for deduction u/s. 80P(2) of the Act in view of the amendment made to sub-section 4 in Section 80P with effect from 01.04.2007 as he was of the view that after the amendment the benefit of Section 80P was restricted only to Primary Agricultural Credit Society and Primary Co-op. Agricultural and Rural Development Bank. According to the A.O, since the Assessee was Co-op. Bank, it was not eligible for deduction u/s. 80P. He accordingly denied the claim of deduction u/s. 80P. Aggrieved by the order of A.O., Assessee carried the matter before ld. CIT(A) who dismissed the appeal of the Assessee by holding as under:- 4.3I have gone through the assessment order and the submissions of the AR carefully. It is seen that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ew of the above, the action of the AO in denying the deduction u/s,80P to the appellant is justified. The same is, hence, confirmed. 6. Aggrieved by the aforesaid order of ld. CIT(A), Assessee is now in appeal before us. 7. Before us, ld. A.R. submitted that Assessee is a Co-op. Credit Society and not a bank and the exclusion provided by sub section 4 to 80P would not be applicable to it and therefore the Assessee is eligible for deduction u/s. 80P. He further placed reliance on the decision of Hon'ble Gujarat High Court in the case of CIT vs. Jafri Momin Vikas Co-op. Credit Society Ltd. (2014) 362 ITR 331 (Guj). He therefore submitted that Assessee be granted deduction u/s. 80P. The ld. D.R. on the other hand supported the order of A.O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... p. Bank but a Credit Co-Op. Society, exclusion clause of sub-section(4) of Section 80P would not be applicable to the Assessee. She therefore submitted that following the aforesaid decision of Hon'ble High Court, the issue needs to be decided in favour of the Assessee. The ld. D.R. on the other hand supported the order of A.O and ld. CIT(A). 7. We have heard the rival submissions and perused the material on record. We find that ld. CIT(A) upheld the order of A.O after considering the definition of Co- Op. Bank mentioned in clause (cci) of Section 56(5) of part-V of Banking Regulation Act, 1949. We however find that the Hon'ble Gujarat High Court in the case of CIT vs. Surat Vankar Sahakari Sangh Ltd. (supra). after considering the clarifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imary co-operative agricultural and rural development banks for exclusion from such exclusion and in other words, continued to hold such entity as eligible for deduction. However, the issue has been considerably simplified by virtue of CBDT circular No. 133 of 2007 dated 9.5.2007. Circular provides as under:- Subject: Clarification regarding admissibly of deduction under section 80P of the Income-Tax Act, 1961. 1. Please refer to your letter no. DCUS/30688/2007, dated 28.03.2007 addressed to Chairman, Central Board of Direct Taxes, on the above given subject. 2. In this regard, I have been directed to state that sub-section(4) of section 80P provides that deduction under the said section shall not be allowable to any co-operative bank ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of sub-section(4) of section 80P, therefore, would not apply.' In the result, Tax Appeals are dismissed. 8. In the present case, Revenue has not placed any material on record to demonstrate that Assessee is a co-operative Bank and not a credit co-operative society. In such a situation, we are of the view the issue in the present case is directly covered by the decision of Hon'ble Gujarat High Court in the case of Surat Vankar Sahakari Sangh Ltd. (supra). Before us, Revenue has not placed any contrary binding decision in its support. In view of the aforesaid facts and respectfully following the aforesaid decision of Hon'ble Gujarat High Court, we are of the view that Assessee is eligible for deduction u/s. 80P. We therefore direct ac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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