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2016 (5) TMI 691

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..... suggest that the primary business of the appellant was banking. We find that there is no case made out for any interference in the impugned Orders. We find that no substantial question of law arises in the present appeal - TAX APPEAL NO. 40 OF 2015 - - - Dated:- 8-3-2016 - F.M. REIS K. L. WADANE, JJ For the appellant: Ms. Asha Dessai, Advocate For the respondents: Mr. Nitin Sardesai, Senior Advocate with Ms. G. Kakodkar, Advocate ORAL ORDER : (PER F.M. REIS, J.) Heard Ms. A. Desai, learned Counsel appearing for the appellant and Mr. N. Sardessai, learned Senior Counsel appearing for the respondent. 2. The above appeal challenges the orders passed by the authorities below whereby the respondent/assesse .....

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..... ed and it can be said that the assessee society was not carrying on banking business as it was not accepting deposits from the persons who were not members. The learned Senior Counsel further submits that this itself suggest that the Appellate Tribunal has rightly come to the conclusion that condition one of the definition of the primary co-operative Bank has not been satisfied and as such, the learned Counsel points out that this aspect has been duly covered by the judgment of the Division Bench of this Court in the case of Qupem Urban Co-operative Credit Society Ltd Vs. Assistant Commissioner of Income-Tax, Circle-1, Margao in the Tax Appeal No. 22 to 24 of 2015 dated 17.4.2015. 5. We have duly considered the submissions of b .....

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..... ion Act defines a primary cooperative bank to mean a cooperative society which cumulatively satisfies the following three conditions : (1) Its principal business or primary object should be banking business of Banking; (2) Its paid up share capital and reserves should not be less that rupees one lakh. (3) Its bye-laws do not permit admission of any other cooperative society as its member. It is accepted position that condition No.(2) is satisfied as the share capital in an excess of rupees one lakh. It has been the appellant's contention that the conditions No. (1) and (3) provided above are not satisfied. 10. Therefore the issue that arises for consideration is whether the appellant satisfies conditio .....

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..... nd therefore it is in banking business. In fact, the impugned order erroneously relies upon bye-law 43 of the society which enables the society to receive deposits to conclude that it can receive deposits from public. However, the impugned order relies upon byelaw 43 to conclude that it enables the appellant to receive deposits from any person is not correct. Thus in the present facts the finding that the appellant's principal business is of Banking is perverse as it is not supported by the evidence on record. So far as the issue of primary object of the appellant is concerned the impugned order gives no finding on that basis to deprive the appellant the benefit of Section 80P of the Act. The impugned order sets out the object clause of .....

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..... be admitted to the membership of the appellant and not a co-operative society. According to the impugned order, a society and a co-operative society are clearly words of different and distinct significance and the membership is only open to society and not to a co-operative society. As rightly pointed out on behalf of the appellant the word society as referred to bye law 9(d) would include the cooperative society. This is so as the definition of a society under the Co-operative Act is co-operative society registered under the Cooperative Act. Besides the qualifying condition 3 for being considered as a primary Cooperative bank is that the bye laws must not permit admission of any other cooperative society. This is a mandatory condit .....

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..... f deduction under Section 80P of the Act only to the extent that the same is earned by the appellant in carrying on its business of providing credit facilities to its members. 7. Taking note of the said observations, we find that the issues sought to be raised in the above appeal stand concluded by the said decision, as it was pointed out by the learned Counsel appearing for the appellant that no appeal has been preferred against the said judgment. Considering the concurrent findings of facts in the present appeal, and no perversity has been shown in such findings, we find that on going through the byelaws and the objects of the said Society, there is nothing to suggest that the primary business of the appellant was banking. We find .....

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