Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2018 (10) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (10) TMI 1121 - AT - Income TaxEligibility for deduction u/s. 80(P) denied - area of operation not confined to ‘a taluk' - amended clause 80P(4) - Impact of article "a" used therein - providing credit facilities to its members for Agricultural And allied Rural Development activities - Held that:- Explanation (b) to section 80P(4) is a defining provision employing the word ‘means’. The Hon’ble Apex Court in the case of West Bengal State Warehousing Corporation vs. Indrapuri Studio Pvt. Ltd [2010 (10) TMI 1059 - SUPREME COURT] held that when the word ‘means’ is used in a definition, it signifies strict interpretation. It is trite law that an exemption provision is to be strictly construed. Moreover, the Cardinal rule of construction is that a provision must be given its ordinary meaning. Natural and ordinary meaning of words should not ordinarily be departed from. The words “having its area of operation confined to a taluk” obtained in the Explanation (b) to sub-section (4) of Section 80P should be understood as ‘limited to’ or ‘within bounds’ of a taluk. The first letter of the English alphabet which precedes the word ‘Taluk’ is used “before nouns and noun phrases that denote a single, but unspecified, person or thing…….”. [Webster’s Dictionary] ’A’ is used to mean or denote ‘one’. A Taluk is a revenue division. Few villages constitute a taluk and few taluks constitute a District. The mischief of sub-section (4) will not fall on a primary cooperative agricultural and rural development bank provided it’s operation is limited to a taluk and the principal object of which is to provide for long term credit for agricultural and rural development activities. Since the assessee’s area of operation was not confined to a Taluk for the relevant assessment year, we hold that it was not entitled to the benefit of deduction u/s. 80P(2) As relying on assessee's own case for the immediately assessment year 2010-2011 we hold that the Income-tax authorities are justified in denying the assessee the benefit of deduction u/s 80P(2) of the I.T.Act, for the impugned year, as well. - Decided against assessee.
|