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| The Tax Publishers2022 TaxPub(DT) 7517 (Panaji-Trib) INCOME TAX ACT, 1961
Section 80P(2)(a)(i)
Where CIT(A) directed AO to restrict the claim for deduction of income under section 80P(2)(a)(i), in respect of interest earned on the loans advanced to the regular members of assessee-society, issue was remanded to AO to decide as to whether a nominal member also falls under the category of a 'member' as provided in the Karnataka Co-operative Societies Act, 1959 and bye-laws of the society and if so, then to allow the exemption under section 80P(2)(a)(i).
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Deduction under section 80P(2)(a)(i) - Co-operativce society - Allowability in respect of interest earned on the loans advanced to nominal members -
Assessee, a Co-operative Society, formed without object of providing credit facilities to its members claimed deduction under section 80P(2)(a)(i). CIT(A) directed AO to restrict the claim for deduction of income under section 80P(2)(a)(i), in respect of interest earned on the loans advanced to the regular members only. Assessee contended that nominal members were treated as mnembers [regular members] under the provisions of the Karnataka Co-operative Societies Act, 1959 as well as bye-laws of the society. Held: Issue was remanded to AO to decide as to whether a nominal member also fall under the category of a 'member' as provided in the Karnataka Co-operative Societies Act, 1959 and bye-laws of the society and if so then to allow the exemption under section 80P(2)(a)(i).
Followed:Mavilayi Service Co-operative Bank Ltd. v. CIT (2021) 431 ITR 1 (SC) : 2021 TaxPub(DT) 273 (SC).
REFERRED :
FAVOUR : Matter remanded.
A.Y. : 2012-13
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