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TMI Blog2020 (9) TMI 625X X X X Extracts X X X X X X X X Extracts X X X X ..... . At the time of assessment, the judgment of the Hon ble jurisdictional High Court in the case of Chirakkal Service Cooperative Bank Ltd. [ 2016 (4) TMI 826 - KERALA HIGH COURT ] was ruling the roost and the certificate issued by the Registrar of Co-operative Society terming the assessee as a primary agricultural credit society would be sufficient for grant of deduction u/s 80P. In the light of the dictum laid down in the case of The Mavilayi Service Co-operative Bank Ltd. v. CIT [ 2019 (3) TMI 1580 - KERALA HIGH COURT ] we are of the view that there should be fresh examination by the Assessing Officer as regards the nature of each loan disbursement and purpose for which it has been disbursed, i.e., whether it for agricultural purpose or not. - Shri Chandra Poojari, AM And Shri George Mathan, JM For the Appellant : Sri.Sivadas Chettoor, CA For the Respondent : Sri.Mritunjaya Sharma, Sr.DR ORDER PER BENCH : These appeals at the instance of the assessees are directed against different orders of the CIT(A). The assessees have also preferred stay applications seeking to stay the recovery of outstanding tax arrears. 2. Common issue is raised in these appeals, hence, they were heard to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 before the hearing of this appeal. 3. It is submitted that the denial of deduction u/s 80P( 4) of the Act by the lower authorities is illegal and unsustainable in law on a harmonious and combined reading of all the applicable provisions of law in this connection. A detailed note in support of this ground shall be filed on or before the hearing of this appeal. 4. The learned CIT(A) had passed the order based on the decisions of Chirakkal and Perinthalmanna case alone and failed to consider the other important grounds raised by the appellant. The CIT(A) is duty bound to decide all the issues/grounds raised in the appeal. Therefore the said order violates the natural justice principles besides being illegal. 5. In the facts and circumstances of the case, the appellant is clearly eligibl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other hand, strongly supported the orders passed by the Income Tax Authorities. 7. We have heard the rival submissions and perused the material on record. The Hon ble jurisdictional High Court in the case of Chirakkal Service Co-operative Co-operative Bank Ltd. v. CIT [(2016) 384 ITR 490 (Ker.)] had held that when a certificate has been issued to an assessee by the Registrar of Co-operative Societies characterizing it as primary agricultural credit society, necessarily, the deduction u/s 80P(2) of the I.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 Mavilayi Service Co-operative Bank Ltd. v. CIT (supra) had reversed the above findings of the Hon ble Kerala High Court in the case of Chirakkal Service Co-operative Cooperative Bank Ltd. v. CIT (supra) . The Larger Bench of the Hon ble Kerala High Court in the case of The Mavilayi Service Co-operative Bank Ltd. v. CIT (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 A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in Antony Pattukulangara [2012 (3) KHC 726] and Perinthalmanna [363 ITR 268]. Moreover, the law laid down by the Division Bench in Chirakkal [384 ITR 490] is not good law, since, in view of the law laid down by the Apex Court in Citizen Co-operative Society [397 ITR 1], on a claim for deduction under Section 80P of the Income Tax Act, by reason of sub-section (4) thereof, the Assessing Officer has to conduct an enquiry into the factual situation as to the activities of the assessee society and arrive at a conclusion whether benefits can be extended or not in the light of the provisions under sub-section (4) of Section 80P of the IT Act. In view of the law laid down by the Apex Court in Citizen Cooperative Society [397 ITR 1] the law laid down by the Division Bench Perinthalmanna [363 ITR 268] has to be affirmed and we do so. 35. In view of the law laid down by the Apex Court in Ace Multi Axes Systems case (supra), since each assessment year is a separate unit, the intention of the legislature is in no manner defeated by not allowing deduction under Section 80P of the IT Act, by reason of sub-section (4) thereof, if the assessee society ceases to be the specified class of societies ..... X X X X Extracts X X X X X X X X Extracts X X X X
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