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TMI Blog2018 (5) TMI 1600X X X X Extracts X X X X X X X X Extracts X X X X ..... r for TDS is also restored to AO to verify if the tax has been deducted by the assessee at source or the recipients has paid tax on it by including the same in their income tax return - ITA No.150/Ran/2016 - - - Dated:- 24-5-2018 - SHRI N.S SAINI, ACCOUNTANT MEMBER AND PAVAN KUMAR GADALE, JUDICIAL MEMBER For The Assessee : None For The Revenue : Shri Deepak Kr Sutariya, CIT(A), JSR ORDER Per N.S.Saini, AM This is an appeal filed by the assessee against the order dated 30.3.2016 of the Pr. CIT, Jamshedpur u/s.263 of the Income Tax Act, 1961. 2. Ld A.R. of the assessee has filed an adjournment application on the ground of medical exigency. The Bench was of the view that the matter can be decided in view ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The provisions of Income Tax Act has defined section 80P(2)(a)(1) as under: Section 80P: 2) the sums referred to in such section(1) shall be the following namely:-a)In the case of a Co-operative Society engaged in- i) carrying on business of banking or providing credit facilities to its members or ii) ..... The assessee is a Co-operative Society of the Jharkhand Government and carrying on the business of banking and/or providing credit facility to its members and the same is claimed on the basis of the following case laws and the facts in the present case:- i) In the case of Addl. CIT Vs UP Co-operative Cane union (1978) reported in 114 ITR 70(All), the Hon'ble Allahabad High court has held that Banking Business i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egram, depreciation, repairs and renewals, stationary and printing, insurance premium, other expenditure are mainly administrative in nature and for the activities of the assessee. Interest paid is mainly on account of deposits from the members and provision for rural development expenses or for agricultural purposes only. e) The bank has been granted a license u/s.22(1) read with section 56(o) of the B.R.Act, 1949 by Reserve Bank of India and a copy of the same is enclosed for ready reference. f) The statutory audit report was submitted to the NABARD on 16.9.2011. The delay in submitting the report beyond the inspection date was due to administrative reason and there is no irregularity on the same. g) Copy of Inspection R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs e.g. M/s. Bhojpur Electricals M/s. S Biswas Co. Etc. 63. The case laws referred to by the assessee bank is on different facts and prior to amendment of section 80O w.e.f 1.4.200 and not applicable to a bank which is the present case. The citation (1982) 135 ITR 355 (Mad) is in respect of Rodier Mill Employees Cooperative Stores Ltd., wherein the supplying of consumer goods to its members on credit was held to be not eligible for 80P(2)(a)(i) deduction. In the case of Kerala Co-operative Consumers Federation Ltd., (1988) 170 ITR 455(Ker), it was held that selling goods to its members on credit cannot be providing credit facilities to its members and not entitled to exemption u/s. 80P(2)(a)(i) of the I.T.Act, 1961. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the case of Citizen Co-operative Society Ltd(supra) has held that with the insertion of sub-section (4) by the Finance Act, 2006, which is in the nature of a proviso to the aforesaid provision, it is made clear that such a deduction shall not be admissible to a co-operative bank. However, if it is a primary agriculture credit society or a primary co-operative agriculture and rural development bank, the deduction would still be provided. Thus, cooperative banks are now specifically excluded from the ambit of Section 80P of the Act. It is not in dispute that the assessee is a co-operative bank. Therefore, the decision of the Pr. CIT is inconsonance with the order of Hon'ble Supreme Court in the case of Citizen Co-operative Society Ltd(s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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