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2014 (6) TMI 930 - AT - Income TaxNon entitlement to deduction of 10% of the aggregate average advances made by its rural branches u/s. 36(1)(viia) - Held that:- An identical issue was considered by the Hon’ble Jurisdictional High Court in the assessee’s own case [2014 (8) TMI 635 - KERALA HIGH COURT ] wherein noted that the assessees are not primary agricultural credit co-operative society or other kind of bank so as to go out of the definition of cooperative bank under sub-clause (a) to clause (viia) of section 36(1) - No doubt, Explanation (ia) to section 36(1)(viia) defines what is a rural branch - It is with reference to a place and certain number of population - It refers to branch of a scheduled bank or a non-scheduled bank - co-operative bank also falls under the category of non-scheduled bank for the purpose of this section - reading of the entire section 36(1)(viia)(a) along with the Explanation would mean two kinds of deductions referred to in the section will be allowed to all those banks only if they satisfy the terms and conditions referred to in the provision - the authorities below were justified in opining that the benefit of deduction of 10 per cent of the aggregate average advances is applicable to co-operative bank also provided their rural branches have advanced such amounts - - Decided against Assessee.
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