Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2015 (8) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2015 (8) TMI 1200 - ITAT PUNEPrinciple of mutuality - Co-operative Society - Disallowance of deduction u/s. 80P - Revenue has denied deduction on the profits earned by assessee from consumer and garments division on the ground that such activities are akin to the activities of consumer society - Held that:- It is an admitted position that these activities were carried out by the assessee for several years and no objection whatsoever was raised by the Department on this count. The assessee has been consistently following the same method of accounting and the nature of activities carried out in the past, as well as, in subsequent assessment years is same. It was only during the impugned assessment year and the following assessment year that the Revenue has raised dispute with respect to profits from consumer goods and garments division We are of the considered view that since the turnover from the consumer divisions as compared to the total turnover of the assessee is miniscule, it would not change the nature of activities of Co-operative Society. The assessee Co-operative Society is primarily engaged in providing credit facilities to its members and it is for the benefit for members that consumer division and cloth division have been included in the activities of the society. By providing such facilities to its members it cannot be said that the assessee is engaged in trading of consumer goods on commercial basis. The profits arising from aforesaid divisions are not liable to be taxed under the principle of mutuality. Any income generated from facilities, amenities, privileges provided to the members in accordance with the bye-laws and regulations of the society is exempt on the principle of mutuality. See CIT Vs. Ranchi Club Ltd. [1991 (9) TMI 52 - PATNA High Court] - Decided in favour of assessee
|