Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2012 (11) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2012 (11) TMI 106 - AT - Income TaxDeduction u/s 80P(2)(i) - cooperative bank - primary credit society versus cooperative credit - CIT(A) allowed the claim - revenue appeal - Held that:- Under the provisions of Section 5(ccii) of Banking Regulation Act, 1949 (AACS), a cooperative credit society is defined as a cooperative society, "the primary object of which is to provide financial accommodation to its members and includes a cooperative land mortgage bank." . The distinction between a primary credit society and a cooperative credit is with reference to their nature of business - 'Primary Credit Society', is when its paid up capital and reserve attain the level of Rs. 1 lac, which can carry on business of banking until it is granted a license or notified that a license cannot be granted to it. These credit societies would not get the benefit of the deduction u/s 80P(2)(a)(i). Also as decided in Salgaon Sanmitra Sahakari Pathpedhi Ltd. Versus Additional Commissioner of Income-tax, Ward-17(3) [2011 (5) TMI 356 - ITAT, MUMBAI] hat the cooperative credit society is not a co-operative bank. Considering the above facts, it is clear that the appellant is not allowed to do banking business as defined under Banking Regulation Act and therefore, is not a co-operative bank. Therefore, it is not excluded from the benefit of deduction u/s 8OP(2)(a)(i) as it does not fall under the exceptions as provided u/s 8OP(4). However, the AO is directed to find out whether there was any interest income on the short term bank deposits and securities taxable u/s 56 included in the total income of this society which has been claimed by them as exempt foolowing the decision of M/s. The Totgars' Cooperative Sale Society Limited Versus ITO, Karnataka [2010 (2) TMI 3 - SUPREME COURT ] - in favour of assessee.
|