TMI Blog1987 (10) TMI 16X X X X Extracts X X X X X X X X Extracts X X X X ..... g out a portion of the building belonging to the assessee ? " The assessee is a co-operative society engaged in carrying on the business of banking by providing credit facilities to its members. The assessee constructed a building to house the bank and the administrative offices. Surplus space in the building was let out. The assessee returned a net amount of Rs. 29,139 for the assessment year 1978-79 and Rs. 20,564 for the assessment year 1979-80 by way of income from property and claimed out of the same, a deduction of Rs. 20,000 for each assessment year under section 80P(2)(c) of the Income-tax Act, 1961. The Income-tax Officer held the view that the assessee is not entitled to claim any further exemption under clause (c) as the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of a co-operative society engaged in activities other than those specified in clause (a) or clause (b) either independently of, or in addition to, all or any of the activities so specified, so much of its profits and gains attributable to such activities as does not exceed Rs. 20,000 shall be deducted in computing the total income. The co-operative society engaged in carrying on the business of banking or providing credit facilities to its members falls under clause (a) of section 80P(2). The claim for exemption under clause (c) is in addition to the exemption provided under clause (a). The provisions are cumulative and mutually supplementing. The limits specified in clause (c) are in relation to the profits and gains attributable t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter of profits and gains attributable to an activity carried on by the society. The building let out is not a commercial asset or the rent received is not profit or gain arising from the exploitation of a business asset. The word " activity " is wider than the word " business ". It connotes a specified form of supervised action or field of action. Read in the context of the profit-earning activity of a co-operative society, it means the corporate activity of the society, that is to say, the combination of operations undertaken by the co-operative society whether or not they amount to a business, trade or profession in the ordinary sense. Clause (c) of section 80P(2) is intended to cover receipts from sources other than the actual conduct of ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
