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TMI Blog2018 (7) TMI 1257X X X X Extracts X X X X X X X X Extracts X X X X ..... 82/2017, 783/2017, 784/2017, 796/2017, 803/2017 & 805/2017 - - - Dated:- 9-7-2018 - VINEET KOTHARI AND S. SUJATHA, JJ. Mr. K.V.Aravind, Adv. for Appellants/Revenue Mr. Mahesh R. Uppin; Mr. N.Shankaranarayana Bhat, Advs., Mr. Tata Krishna, Adv. for Mr. Chythanya, Adv., and Mr. A.Shankar Mr. Lava, Advs. for Respondents/Assessees JUDGMENT The Revenue has preferred these Appeals under Section 260A of the Income Tax Act, 1961 ( Act for short). 2. The substantial questions of law framed in the memorandum of appeal arising out of the common order passed by the Income Tax Appellate Tribunal, Panaji Bench, Panaji, relating to the different assesses- respondents herein for the assessment year 2013-14 are identical, as such these appeals are disposed of by the common judgment. The substantial questions of law suggested by the revenue and considered by us are extracted here under: 1. Whether on the facts and in the circumstances of the case learned ITAT is justified in law in holding that the assessee society is entitled to deduction under section 80P(2) of the Act? 2. Whether on the facts and in the circumstances of the case learned ITAT is justified in l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds as under:- (4) The provisions of this section shall not apply in relation to any co-operative bank other than a primary agricultural credit society or a primary co-operative agricultural and rural development bank. (a) co-operative bank and primary agricultural credit society shall have the meanings respectively assigned to them in Part V of the Banking Regulation Act, 1949 (10 of 1949); (b) primary co-operative agricultural and rural development bank means a society having its area of operation confined to a taluk and the principal object of which is to provide for long- term credit for agricultural and rural development activities. Therefore, the intention of the legislature is clear. If a Co-operative Bank is exclusively carrying on banking business, then the income derived from the said business cannot be deducted in computing the total income of the assessee. The said income is liable for tax. A Co- operative bank as defined under the Banking Regulation Act includes the primary agricultural credit society or a primary co-operative agricultural and rural development bank. The Legislature did not want to deny the said benefits to a primary agricult ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rnataka High Court has considered the decision of the Apex Court relied upon by the AO in the decision rendered in the case of M/s Totgar s Cooperatives Sales Society Ltd. Vs. ITO. Accordingly in the facts as the stand in the case of these respective cooperative societies which have been noticed to be admittedly engaged in the activity of accepting deposits and providing credit facility to its members, interest received from the banks on the surplus money kept in fixed deposits has been held to be attributable to the business of providing credit facilities to its members. We further note that the Hon ble Bombay High Court was called upon to decide the identical issue and has discussed the issue at length in the case of Pr.CIT Vs. Goa PWD Staff Co-operative Credit Society Ltd. and others wherein the view taken by their lordships in the case of M/s The Quepem Urban Co-Operative Credit Ltd. has been followed. For ready reference the same is reproduced hereunder: 6. We have given our thoughtful consideration to the rival contentions and with the assistance of the learned counsel, we have also gone through the said judgment and the relevant provisions of the said Act. On going t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isfied. In any event, the facts finding authorities after examining the material on record have concurrently come to the conclusion that the respondent s Societies are not Banks but Co-operative societies and as such they are entitled for exemption in terms of section 80P(2)(a)(i) of the said Act. The findings of fact arrived at by the authorities below cannot be interfered by this Court in the present appeals unless there is perversity in such findings. The learned counsel appearing for the appellant has not pointed out any material which has not considered or that there is any misreading of the evidence whilst coming to such conclusions. The contention of Ms. A. Desai, learned counsel appearing for the appellant that in view of the definition of the word income as provided in Section 2(24) (vila), the respondents Societies are to be treated as a Bank cannot be accepted. This aspect has also been taken note by the Division Bench while disposing of the said appeals in the case of M/s. The Quepem Urban Co-Operative Credit Society Ltd.,(Supra). 8. Taking note of the observations in the said judgment in the case of M/s. The Quepem Urban Co-operative Credit Society Ltd., (Sup ..... X X X X Extracts X X X X X X X X Extracts X X X X
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