| The Tax Publishers2020 TaxPub(DT) 3606 (Coch-Trib) : (2020) 185 ITD 0469 INCOME TAX ACT, 1961
Section 80P
AO was directed to list out the instances where loans have disbursed for non-agricultural purposes, etc., and accordingly conclude that assessee's activities were not in compliance with activities of primary agricultural credit society functioning under the Kerala Co-operative Societies Act, 1969, before denying the claim of deduction under section 80P(2).
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Deduction under section 80P - Co-operative society - Banking business -
Assessee was a co-operative society registered under the Kerala Co-operative Societies Act, 1969. Solitary issue that was raised was whether CIT(A) was justified in confirming AO's order denying claim of deduction under section 80P(2)(a)(i). AO alleged that assessee was essentially doing business of banking, and therefore, in view of insertion of section 80P(4) with effect from 1-4-2007, assessee was not entitled to deduction under section 80P. Held: There should be fresh examination by AO as regards nature of each loan disbursement and purpose for which it was disbursed, i.e., whether it was for agricultural purpose or not. AO shall list out the instances where loans have disbursed for non-agricultural purposes, etc. and accordingly conclude that assessee's activities were not in compliance with activities of primary agricultural credit society functioning under the Kerala Co-operative Societies Act, 1969, before denying the claim of deduction under section 80P(2).
Followed:Mavilayi Service Co-Operative Bank Ltd., 2019 TaxPub(DT) 4909 (Ker-HC).
REFERRED : Dy. CIT, Circle 11 (1), Bangalore v. ACE Multi Axes Systems Ltd. 2017 TaxPub(DT) 5071 (SC),Citizen Co-Operative Society Limited, Through Its Managing Director, Hyderabad v. Asstt. CIT (2017) 397 ITR 1 (SC) : 2017 TaxPub(DT) 2053 (SC),Vadilal Chemicals Ltd. v. State of Andhra Pradesh 2005 TaxPub(EX) 3183 (SC), Kodiyeri Service Co-Operative Bank Ltd., Vazhappally Service Co-Operative Bank Ltd. Poonjar Service Co-Operative Bank Ltd. v. CIT, COCHIN, Chirakkal Service Co-Operative Bank Ltd. v. CIT (2016) 68 Taxmann.com 298 (Ker) : (2016) 239 Taxmann.com 417 (Ker) : (2016) 384 ITR 490 (Ker.) : 2016 TaxPub(DT) 1770 (Ker-HC), Perinthalmanna Service Co-Operative Bank Ltd. v. ITO & CIT (2014) 363 ITR 268 (Ker-HC) : 2014 TaxPub(DT) 1572 (Ker-HC),Antony Pattukulangara v. E.N. Appukuttan Nair & Ors. (2012 (3) KHC 726)
FAVOUR : In assessee's favour.
A.Y. :
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