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TMI Blog2013 (3) TMI 762X X X X Extracts X X X X X X X X Extracts X X X X ..... equire adjudication. The lone ground being ground No.1 surviving for adjudication is reproduced herein under for reference: 1. The Ld. Commissioner of Income-tax (Appeals)-XX, Ahmedabad has erred in law and on facts in deleting the disallowance of ₹ 13,25,411/- made u/s. 80P (2) (a) (i) of the Act.. 3. The assessee is a co-operative society engaged in the activity of providing credit facilities to its members filed its return of income on 02-11-2007 declaring its income as nil, for the assessment year 2007-08 and the same was processed u/s 143(1) of the IT Act. The learned AO was of the view that the assessee s claim u/s 80P of the Act was not as per law and thereby the assessee had understated its income and on this basis th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Banking (including providing Credit facilities) carried on by co-operative society with its members shall be included in the definition of income . This amendment take effect from 1st April 2007 and accordingly, apply in relation to the assessment year 2007-08 and subsequent year. (Clause 3 and 19) 4.1 In this context, the learned AO was of the view that income earned by the co-operative credit society is not exempt u/s 80P (2) (a) (i) by virtue of section 80 P(4) of the Act. The learned AO therefore, disallowed the claim of the assessee of ₹ 13,25,411/- u/s 80P(2) (a) (i) of the Act and added the same to the income of the assessee. 5. The assessee carried the matter in appeal before the learned CIT(A). The learned CIT(A) co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8. On the other hand, the learned AR relied on the order of the learned CIT(A) and also placed reliance on the order of the ITAT Pune Bench in the case of ITO Vs Vardhman Nagari Sahakari Patsantha Ltd. in ITA No.1142/PN/2011, cited supra for the assessment year 2008-09- wherein it was held as under: 9. The Banking Regulation Act, 1949 defines of Cooperative bank in cl. (cci) of sec. 5(as inserted by sec. 56 of the said Act.) and Co-operative Credit Society is not included but its identity is kept separate by way of independent definition in view of Clause (ccii) of Sec. 5 of the Banking Regulation Act which defines what is meaning of Credit Co-operative Society . On plain reading of the Banking Regulation Act, 1949, nowhere it is sugg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nk nor it can be said as a Primary Co-operative Bank within the meaning of Banking Regulation Act, 1949. Hence, the assessee being a Co-operative Credit Society is entitled for deduction u/s. 80 P (2) (a) (i) of the Act. We accordingly uphold the order of the learned CIT(A). 8.1 The learned AR also further relied in the case of Totgars Co-operative Sale Society Ltd. reported in 322 ITR 272, wherein it was held that the assessee being co-operative society carrying on the business of marketing the agricultural produce of its members was not a co-operative bank and the activities of the assessee fell within the ambit of section 80P (2) (a) (i) and (3) of the Act. 8.2 We have heard the rival submissions and carefully perused the materi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o-operative bank other than a primary agricultural credit society or a primary co-operative agricultural and rural development bank . It only make the issue clear that cooperative banks are taken out from the ambit for deduction u/s 80 P of the Act, however, exemption is granted to primary agricultural credit society or a primary co-operative agricultural and rural development bank. 8.4 From the above discussions and the decisions cited by the assessee and taking into account of the facts and the issue, we are in conformity with the order of the learned CIT(A) and accordingly hold that the assessee is entitled to the benefit of deduction u/s 80P (2)(a)(i) of the Act. 9. In the result, the appeal of the revenue is dismissed. Order ..... X X X X Extracts X X X X X X X X Extracts X X X X
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