TMI Blog2002 (7) TMI 233X X X X Extracts X X X X X X X X Extracts X X X X ..... mes- ----------------------------------------------------------------- Head Asstt. years ------------------------ 1995-96 1996-97 ----------------------------------------------------------------- (i) Income from house property 87,294 98,318 (ii) Income from other sources 4,10,980 5,82,394 -------- --------- 4,98,274 6,80,712 Less : Deductions under section 80P(2)(d)and under section 4,29,222 5,99,398 80P(2)(c)(ii) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntative and perused the intimation. The Assessing Officer has rejected the appellant's claim for deduction under section SOP for a sum of Rs. 20,000 for each year, by invoking the provisions of 80P(2)(f). The appellant has asked deduction under section 80P stating that its case falls under the provisions of section 80P(2)(c)(ii). Section 80P(2)(f) reads as under: 'In the case of a co-operative society, not being a housing society or an urban consumers' society or a society carrying on transport business or a society engaged in the performance of any manufacturing operations with the aid of power, where the gross total income does not exceed twenty thousand rupees, the amount of any income by way of interest on securities or any income fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ein it was held that the income derived by a Cooperative, Housing Society from letting out of shops is entitled to deduction of Rs. 20,000 under section 80P(2)(c)(ii) of the Act, as it stood during the relevant period. The learned Departmental Representative, on the other hand, contended that the words 'profits and gains' used in section 80P(2)(c)(ii) are relevant only in the context of a business activity carried on, and as such deduction under section 80P(2)(c)(ii) is not allowable, in the present case. 4. I am of the view that the assessee deserves to succeed, as the issue raised in the present appeals is at least debatable. The provisions of section 80P(2), to the extent relevant for our purpose, read as under- "80P. (1) Where, in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its members, namely:- (1) the individuals who contribute their labour, or, as the case may be carry on the fishing or allied activities; (2) the co-operative credit societies which provide financial assistance to the society; (3) the State Government; (b) in the case of a co-operative society, being a primary society engaged in supplying milk, oilseeds, fruits or vegetables raised or grown by its members to- (i) a federal co-operative society, being a society engaged in the business of supplying milk, oilseeds, fruits, or vegetables as the case may be; or (ii) the Government or a local authority; or (iii) a Government company as defined in section 617 of Companies Act, 1956 (1 of 1956) or a corporation established by or under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent." It may be observed that what is referred to in section 80P(2)(c) is "profits and gains attributable to such activities" of a co-operative society and not profits and gains of a business. The activities may include even letting of shops, even though the income from such letting is assessed only under the head "house property" and not under the head 'business'. It may also be observed that there is reference to "profits and gains of business attributable to any one or more of such activities" in section 80P(2)(a), and there is reference to "profits and gains of such business" in section 80P(2)(b), whereas the word 'business' is conspicuous by its absence in section 80P(2)(c). What is referred to in section 80P(2)(c) is, as already not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on, unlike carried forward business loss, can be adjusted against income under other heads, even though the section, in the words of the Apex Court, "somewhat unfelicitously, used the expression 'profits and gains' as it occurs in the statute in the fasciculus of sections dealing with the computation of business income." So, it appears that in certain contexts, like the one before us in this appeal, 'profits and gains' may not be restricted to the net proceeds of the business operations, but may extend to net proceeds of other activities. At least, to my mind, this issue is debatable. 7. Further, the reliance placed by the Assessing Officer on the provisions of section 80P(2)(f) is not of any assistance to the Revenue, because the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X
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