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TMI Blog2016 (12) TMI 1838X X X X Extracts X X X X X X X X Extracts X X X X ..... to the assessee and served upon it. The assessee is a Co-operative Society and Registered under the Co- operative Societies Act, 1960. The object of the Society is to enable its members to obtain loan from the Society. During the course of assessment proceedings, the AO noticed that the assessee has received an interest on loans given to its members and also interest from the deposits made with co-operative banks and scheduled banks and claimed deduction u/s 80P in respect of interest received from the schedule bank. The AO issued show cause notice as to why the deduction claimed under section 80P should not be disallowed by rejecting the submission of the assessee that similar deduction has been allowed in the assessment year 2010-11 by the ld.CIT(A). The AO brushed aside the submissions of the assessee by holding that the order of the ld. CIT(A) has been challenged by the Income Tax Appellate Tribunal. The AO held that the assessee is a co-operative bank other than a primary agricultural credit society or a primary co-operative agricultural and rural development bank. The assessee fulfills the condition laid down under section 56(c)(ccv) of Part V of the Banking Regular Act, 1949 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Ld CIT (A) has erred in allowing deduction u/s 80P(2)(a)(i) without considering insertion of section 80P(4) and sub clause (viia) to section 2(24) vide Finance Act, 2006 w.e.f. 1.4.2007. 3. On the facts and in the circumstances of the case and in law, the Ld CIT (A) has erred in holding that the facts of the assessee‟ s case are not identical with any of the case laws relied upon by the AO especially decision of ITAT Jaipur in the case of Kekri Sahakari Bhumi Vikas Bank Ltd and Cochin ITAT in the case of Kerala State Coop. Agricultural Rural Development Bank Ltd. 4. On the facts and in the circumstances of the case and in law, the Ld CIT (A) has erred in not following his own order in the case of vishal Janseva Sahakari Patsantha Ltd for AY 2008-2009 on the same issue vide order No. CIT (A)- 26/IT- 30/15(3)(3)/10-11, dated 4 th July, 2012." 2. Briefly stated relevant facts of the case are that the assessee filed the return of income declaring the total income of Rs. NIL after claiming deduction u/s 80P of the Act for an amount of Rs. 40,13,467/-. The case was scrutinized under CASS and the notices u/s 143(1) & 143(2) were issued and the assessment was completed u/s 14 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issed. 6. The ground No.2 raised by the Revenue also stands covered by para 2.1 and 2.2 of the decision of the Co-ordinate Bench of the Tribunal in assessee's own case order dated 23.5.2016 (supra), which is reproduced below: 2.1. During hearing, the ld. counsel for the assessee, Shri Rohit C. Kasat, at the outset, pointed out that the impugned issue is covered in favour of the assessee by the decision of the Tribunal in the case of Punjab National Bank Employees Credit Society Ltd. (ITA No.3415 & 2935/Mum/2014) order dated 31/03/2016. This factual matrix was consented to be correct by the ld. DR, Shri Ganesh Bare. 2.2. We have considered the rival submissions and perused the material available on record. In view of the above, we are reproducing hereunder the relevant portion of this order dated 31/03/2016 for ready reference and analysis:- "There are two appeals under consideration for the AY 2010- 2011 and they are cross appeals. These two appeals are field against the order of the CIT (A)-26, Mumbai dated 18.2.2014. Since, the issues raised in these appeals are inter- connected, therefore, for the sake of convenience, they are clubbed, heard together and disposed of in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o perused the judgment of the jurisdictional High Court in the case of Quepem Urban Cooperative Credit Society Ltd vs. ACIT [2015} 377 ITR 272 (Bom which was relied upon by the Ld Counsel for the assessee for the proposition that such lending activities do not constitute banking activities as the same are transacted between the cooperative society and the members of the society. Since, no public is involved the definition of 'banking' does not cover such activities. As such, there is no Reserve Bank of India's approval for conducting such banking activities in this case. He also relied on the definition of ''banking'' and read out from the contents of section S of the Banking Regulation Act 1949 and the same reads as under:- Sec. 5(b) "banking" means the accepting, for the purpose of lending or investment, of deposits of money from the public, repayable on demand or otherwise, and withdrawal by cheque, draft, or otherwise; 7. From the above, Ld Counsel for the assessee demonstrated that the members of the Credit Cooperative Society do not constitute "public" and there is no depositing, withdrawal by cheque or draft etc. After considering the said jud ..... X X X X Extracts X X X X X X X X Extracts X X X X
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