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TMI Blog2018 (5) TMI 246X X X X Extracts X X X X X X X X Extracts X X X X ..... n for Ld. CIT(A) in not following the order of the Tribunal in the case of same assessee for A.Y. 2008-2009. As in the case of Agrawal Warehousing and Leasing Ltd [2002 (7) TMI 86 - MADHYA PRADESH High Court] held that the Ld. CIT(A) not only committed judicial impropriety but also erred in law in refusing to follow the order of the Appellate Tribunal. The conditions of Section 80P(2)(a)(i) and also 80P(2)(d) are satisfied by assessee. - Decided in favour of assessee - ITA.No.2900 And 2901/Del./2015 - - - Dated:- 26-4-2018 - SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI O.P. KANT, ACCOUNTANT MEMBER For The Assessee : Shri Puneet Agarwal, Shri Deepak Thakur And Shri Sai Prasana Dash Advocates For The Revenue : Shri S.R. Senapati, Sr. D.R. ORDER PER BHAVNESH SAINI, J.M. Both the appeals by the same Assessee are directed against the different Orders of the Ld. CIT(A)-XX, New Delhi, Dated 16th March, 2015, for the A.Ys. 2010-2011 and 2011- 2012. 2. We have heard the learned Representatives of both the parties and perused the material on record. 3. The issue is common in both the appeals. For the purpose of disposal of both the appeals, we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... correct. The A.O. had divided the income into two parts i.e., income for Members and other interest income on funds invested by assessee with Bombay Mercantile Cooperative Bank Ltd., and dividend from Delhi State Corporation Bank. The A.O. held that interest income is taxable. It is stated that A.O. relied upon the decision of the Hon ble Supreme Court in the case of Totgar s Co- operative Sale Society Ltd., vs. ITO (2010) 322 ITR 283 (SC). It was submitted that the facts in this case are clearly distinguishable because it relates to a Society whose business is sales i.e., Marketing. A Marketing Society s main business is not of providing credit facilities to its Members and such a Society getting short term fund invested and getting income from it may be taxable. The assessee s interest income is however from its main business. This case does not relate to Cooperative Bank. The ITAT, Chandigarh Bench in the case of Punjab State Cooperative Federation of House Building Society Ltd., vs. ACIT in ITA.No.966/Chd./2009 dated 29th January, 2010 decided the issue in favour of the assessee by holding that funds kept in Bank can be said to be ready for utilisation by the Cooperative Societ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 991-92 and further by Mumbai Tribunal vide order dated 07.09.2011 in I.T.A. No. 5292 for Assessment Year 1997-98. Therefore it is held that fixed deposits placed with Bombay Mercantile Bank falls within the exemption granted by Section 80P(2)(d) of the Act. The assessee was also eligible under the provisions of Section 80P(2)(a)(i) as the funds placed by assessee in the form of fixed deposits can be said to be kept for the purpose of business of the assessee as the assessee had availed credit facilities also against such fixed deposits which were again used for the purpose of business of assessee. Moreover, under similar circumstances, Chandigarh Bench in I.T.A. No. 996/2009 as noted by Ld CIT(A) has decided in favour of assessee. The dividend income is exempt for all persons including assessee. The interest income from bank amounting to ₹ 18,190/- is though not exempt u/s 80(p)(2)(d) but is exempt u/s 80P(2)(i) of the Act. The case law of Totgars Cooperative Society was rightly distinguished by Ld. CIT(A). Therefore, keeping in view all facts and circumstances, we do not find any infirmity in the order of Ld. CIT(A). 10. In view of above, appeal filed by revenue is dis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e I.T. Act for the interest income earned on unutilized idle funds kept for business purposes of the Society being deposited with M/s. Banas Bank. Learned Counsel for the Assessee further submitted that in subsequent A.Y. 2013-2014, the Ld. CIT(A)-27, vide order dated 15th February, 2018, in the case of the assessee allowed similar claim of assessee. Copies of all the orders are placed on record. Learned Counsel for the Assessee, therefore, submitted that the issue is covered in favour of the assessee by order of the Tribunal in the case of same assessee and other decisions referred to above. 7. On the other hand, Ld. D.R. relied upon the orders of the authorities below and submitted that assessee made a claim of deduction under section 80P(2)(d) of the I.T. Act before authorities below and no claim is made for deduction under section 80P(2)(a)(i) of the I.T. Act. 8. We have considered the rival submissions. It is not in dispute that assessee is a Cooperative Urban Thrift Credit Society engaged in providing credit facilities to its Members and only its Members can get credit facilities. The assessee claimed that its income is exempt under section 80P of the I.T. Act from ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Order of the Tribunal, the decision of the Hon ble Supreme Court in the case of Totgars Cooperative Sale Society Ltd., (supra) was found to be distinguishable on facts. Therefore, there was no justification for Ld. CIT(A) to distinguish the Order of the Tribunal in the case of the same assessee. The Hon ble Karnataka High Court in the case of Tumkar Merchants Souharda Credit Cooperative Ltd., Tumkur vs. ITO, Tumkur (supra) in para-8 held as under: 8. Therefore, the word attributable to is certainly wider in import than the expression derived from . Whenever the legislature wanted to give a restricted meaning, they have used the expression derived from . The expression attributable to being of wider import, the said expression is used by the legislature whenever they intended to gather receipts from sources other than the actual conduct of the business. A Cooperative Society which is carrying on the business of providing credit facilities to its members, earns profits and gains of business by providing credit facilities to its members. The interest income so derived or the capital, if not immediately required to be lent the members, they cannot keep the said amount id ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the assessee is allowed. ITA.No.2901/Del./2015 A.Y. 2011-2012 : 10. The assessee has raised the following grounds in its appeal : 1. The order of assessing officer is bad in law and against the facts of the case. 2. A.O. has wrongly disallowed and C.l.T (A) has wrongly upheld the disallowance of deduction claimed by A u/s 80P for the interest on FDR earned by it on FDR kept with Bombay Mercantile Co Operative Bank Limited of ₹ 2,10,61,424/- and also saving bank interest of ₹ 3,75,966/- and also has wrongly upheld that interest on FDR kept with Bombay Mercantile Co Operative Bank Limited is Income from Other Sources while A claiming it is a business income. 3. Without prejudice to the ground no. 2, the assessable income of the A can t exceed amount of deduction u/s 80P claimed by A . In this year assessee claim u/s 80P is ₹ 82,95,417/- and it can t be assessed at an income of exceeding ₹ 82,95,417/- as only point of contention is allowably of deduction u/s 80P. 11. The issue is same as have been considered in A.Y. 20102011. Following the reasons for decision for the same, we set aside the orders of the authoriti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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