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TMI Blog2017 (4) TMI 297X X X X Extracts X X X X X X X X Extracts X X X X ..... y this consolidated order. 3 The grounds raised by the revenue read as follows: 1. The Learned Commissioner of Income tax (Appeals), erred ITI concluding that "the assessee being a Primary Agricultural Credit Co- operative Society registered under the Kerala Co-operative Society Act is entitled for exemption its income u/s 80(P)(2) as claimed in the return filed". 2. It is respectfully submitted that the respondent is essentially, a Co- operative bank and not merely a primary agricultural credit Society and hence the allowance of deduction ix] s. 80 P to the respondent assessee while computing the total income was irregular in nature and also against law. 3. The present appeal involves substantial question of law. The appeal involving ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /s 80P for the relevant assessment year was Rs. 45,457,476/- 4.1 The claim of deduction u/s 80P(2) of the Act was denied by the Assessing Officer while completing the assessment u/s 143 r.w.s 147 of the Act for the assessment year 2008-09. The Assessing Officer held that the assessee could not be treated as primary agricultural society as it was engaged in the business of banking and the provisions of section 80P(4) disentitle the assessee, who is doing the business of banking, for claiming deduction u/s 80P(2) of the Act. 4.2 Aggrieved by the order of the Assessing Officer, the assessee preferred appeal for the AY 2008-09 before the first appellate authority. The CIT(A) following the judgment of the Hon'ble jurisdictional High Court in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made available to this court as part of the paper books, clearly show that they have been classified as primary agricultural credit societies by the competent authority under the provisions of that Act. The parliament, having defined the term 'co-operative society' for the purposes of the BR Act with reference to, among other things, the registration of a society under any State law relating to co-operative societies for the time being; it cannot but be taken that the purpose of the societies so registered under the State Law and its objects have to be understood as those which have been approved by the competent authority under such State law. This, we visualise as due reciprocative legislative exercise by the Parliament recognisin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ain any finding of fact to the effect that the bye- 1aws of any of the appellant or its classification by the competent authority under the KCS Act lS anything different from what we have stated herein above. For this reason, it cannot but be held that the appellants are entitled to exemption from the provisions of section 80P of the IT Act by virtue of sub- section 4 of that sect; on. In this view of the matter, the appeals succeed. 17. In the light of the aforesaid, we answer substantia1 question 'A' in favour of the appellants and hold that the Tribunal erred in law in deciding the issue regarding the entitlement of exemption under section 80P against the appellants. We hold that the primary agricultural credit societies, regis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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