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TMI Blog2020 (9) TMI 275X X X X Extracts X X X X X X X X Extracts X X X X ..... 012-2013 to 2015-2016. 2. Common issue is raised in these appeals, hence, they were heard together and are being disposed of by this consolidated order. 3. The solitary issue that is raised is whether the CIT(A) is justified in confirming the Assessing Officer's order in denying the claim of deduction u/s 80P(2)(a)(i) of the I.T. Act. 4. The brief facts of the case are as follow: The assessee is a co-operative society registered under the Kerala Co-operative Societies Act, 1969. For the assessment years 2010-2011 and 2012-2013 to 2015-2016, `Nil' returns were filed after claiming deduction u/s 80P of the I.T. Act. The assessment orders were passed for assessment years 2010-2011 and 2012-2013 to 2015-2016, wherein the Assessing O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l grounds have been raised and they read as follow:- "1. The order of the Learned Commissioner of Income Tax(Appeals), Thrissur in so far as it is prejudicial to the interests of the appellant is opposed to law, facts and circumstances of the case. 2. It is submitted that the appellant is clearly eligible for deduction u/s 80P(2)(a)(i) of the Income-tax Act 1961 and the observation or finding to the contrary by the lower authorities are illegal and unsustainable. It is further submitted that on a harmonious and combined reading of all the applicable provisions of law in this connection along with the scheme of the Act, the appellant is clearly eligible for the deduction. A detailed note in support of this ground shall be filed on or bef ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... finition of Co-operative credit society u/s 5 (ccii) of the Banking Regulation Act 1949. 8. It is submitted that if the department is treating the appellant as a Cooperative Bank then all the other deductions and reliefs provided to the said banks should also be made available to the appellant including the deduction u/s 36(1)(viia). 9. The appellant is eligible for complete exemption from tax on application of the doctrine of mutuality. 10. The status of the appellant as AOP as fixed by the AO is not correct with the result that the order passed in the status of AOP is liable to be quashed. 11. It is submitted that the Special Leave Petition challenging the full bench decision of the Hon'ble Kerala High court in Mavilayil case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T. Act has to be granted to the assessee. However, the Full Bench of the Hon'ble Kerala High Court in the case of The Poonyar Service Co-operative Bank Ltd. (supra) had reversed the above findings of the Hon'ble Kerala High Court in the case of Chirakkal Service Co-operative Bank Ltd. (supra). The Larger Bench of the Hon'ble Kerala High Court in the case of The Poonyar Service Co-operative Bank Ltd. (supra) held that the Assessing Officer has to conduct an inquiry into the factual situation as to the activities of the assessee society to determine the eligibility of deduction u/s 80P of the I.T. Act. It was held by the Hon'ble High Court that the Assessing Officer is not bound by the registration certificate issued by the Re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provide loans and advances for agricultural purposes, the rate of interest on such loans and advances to be at the rate to be fixed by the Registrar of Co-operative Societies under the KCS Act and having its area of operation confined to a Village, Panchayat or a Municipality and as such, they are entitled for the benefit of sub-section (4) of Section 80P of the IT Act to ease themselves out from the coverage of Section 80P and that, the authorities under the IT Act cannot probe into any issues or such matters relating to such societies and that, Primary Agricultural Credit Societies registered as such under the KCS Act and classified so, under the Act, including the appellants are entitled to such exemption. 34. In Chirakkal [384 ITR 49 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that assessee was essentially doing the business of banking and disbursement of agricultural loans by the assessee was only minuscule. Therefore, the Assessing Officer concluded that the assessee cannot be treated as co-operative society. The Assessing Officer after perusing the narration of the loan extracts in the statutory audit report for assessment years 2010-2011 and 2012-2013 to 2015-2016, came to the conclusion that out of the total loan disbursement, only a minuscule portion has been advanced for agricultural purposes. We are of the view that the narration in loan extracts in the audit reports by itself may not conclusive to prove whether loan is a agricultural loan or a non-agricultural loan. The gold loans may or may not be disbu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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