9911796707
TMI Blog2018 (3) TMI 1095X X X X Extracts X X X X X X X X Extracts X X X X ..... have accepted the explanation offered by the Appellant and allowed the exemption under Section 80P (2) (a) (i) of the Act in respect of the interest on the deposits earned in the course of the activity of the Appellant-Society and the income was attributable to the said activity. 2. The learned CIT (Appeals) ought to have appreciated that the Supreme Court judgment in the case of Totgar's Co-operative Sale Society Ltd (2010) 188 Taxman 282 was distinguishable. 3. The learned CIT (Appeals) ought to have followed the jurisdictional High Court judgment in the case of Guttigedarara Credit Cooperative Society Ltd vs. ITO (2015) 377 ITR 464 (Karn) and also in the case of Yamakaninardi Co-operative Credit Society vs. cit (2014) 45 Taxman ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the case of Totgars Co-operative Sales Society Ltd. Vs. ITO (supra) and even after that, the issue in dispute was decided by Hon'ble Karnataka High Court in favour of the assessee. As against this, the ld. DR of revenue supported the orders of authorities below. He also submitted that as per a recent judgment of Hon'ble Karnataka High Court rendered in the case of PCIT and Another Vs. Totagars Co-operative Sale Society as reported in 395 ITR 611 (Karn), Hon'ble Karnataka High Court has decided the issue in favour of the revenue and against the assessee and therefore, this later judgment should be followed because this judgment is a later judgment dated 16.06.2017. 4. I have considered the rival submissions. I find that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iness of banking and therefore, it is liable to be deducted in terms of Section 80P (1) of the Act. 5. Now I examine the facts and basis of judgment of Hon'ble Karnataka High Court rendered in the case of PCIT and Another Vs. Totagars Co-operative Sale Society (supra). In this case, it is noted by Hon'ble Karnataka High Court that the assessee is engaged in the business of marketing the agricultural produce of its members and it retains the sale proceeds in many cases. It is this 'retained amount' which was payable to its members, from whom produce was bought, which was invested in short-term deposits/securities and such an amount, which was retained by the assessee-society and it was a liability and it was shown in the bal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee. 6. On a specific query from the bench, it was submitted by ld. AR of assessee that necessary facts on this aspect are not readily available and there is no finding of any of the authorities below on this aspect. Under these facts, I feel it proper to restore the matter back to the file of AO for fresh decision after examining this aspect of the facts of the present case in the light of these two judgments and in the light of above observations. Hence I set aside the order of CIT (A) and restore the matter back to the file of AO for fresh decision in the light of above discussion after providing adequate opportunity of being heard to assessee. 7. In the result, the appeal filed by the assessee stands allowed for statistical purposes. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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