TMI Blog2019 (1) TMI 116X X X X Extracts X X X X X X X X Extracts X X X X ..... mitted as members of the society. In such circumstances, the Assessing Officer fell into an error in not granting any relief to the assessee society, which was rightly granted by the CIT (A) as confirmed by the Tribunal. In addition to that, the Assessing Officer has not pointed out that loans have been disbursed to all and sundry in terms of the provisions of the TNCS Act and in terms of Clause (b) to Sub-Section (4) of Section 80P of the Act, the society has an area of operation, operates within the taluk and will provide long term credit for agricultural and rural development activities as well. The CIT (A) rightly granted the relief to the assessee as confirmed by the Tribunal. - Decided against the Revenue. - Tax Case Appeal Nos.882 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ficer clearly stated in paragraph 3.1 of the assessment order that anyone can become an associate member of the society on payment of a nominal token fee? 3. The undisputed fact is that the assessee is a primary agricultural cooperative credit society registered under the provisions of the Tamil Nadu Cooperative Societies Act, 1983 (for brevity, the TNCS Act). 4. For the assessment year 2013-14, the assessee filed their returns on 30.9.2013 admitting NIL- income and claimed deductions under Section 80P(2)(a)(i) of the Act to the tune of ₹ 2,54,91,711/- and under Section 80P(2)d) of the Act to the tune of ₹ 93,26,965/-. 5. For the assessment year 2014-15, the assessee filed their return of income on 27.11.2014 adm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der Section 80P(2)(d) of the Act and by disallowing the entire claim of deduction under Section 80P(2)(a)(i) of the Act, levied interest and initiated penalty proceedings under Section 271(1)(c) of the Act. 8. Before the Assessing Officer, for the assessment year 2014-15, the assessee relied upon two decisions of this Court namely (i) in the case of CIT, Coimbatore Vs. M/s.Veerakeralam Primary Agricultural Cooperative Credit Society [TCA.Nos.735 and 755 of 2014 460 of 2015 dated 05.7.2016]; and (ii) in the assessee's own case in TCA.No.490 of 2016 dated 02.8.2016 for the assessment year 2011-12. The Assessing Officer was of the view that the assessee has got two categories of members namely shareholding members cal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al to the Commissioner of Income Tax (Appeals) [hereinafter called the CIT(A)], who, by separate orders respectively dated 30.8.2016 and 31.7.2017 respectively for the assessment years 2013-14 and 2014-15, allowed the appeals filed by the assessee. As against the same, the Revenue carried the matters on appeal to the Tribunal. However, the Tribunal, by the impugned orders, dismissed the appeals filed by the Revenue. Therefore, the Revenue is before us. 10. The learned Senior Standing Counsel for the Revenue submits that the decision of the Hon'ble Supreme Court in the case of Citizen Cooperative Society Limited Vs. ACIT [reported in (2017) 84 Taxmann.com 114] is in favour of the Revenue and that the review petition filed against ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat is required is that the cooperative society should answer the description of a society engaged in carrying on the business of providing credit facilities to its member. Once the description is answered, then automatically, the benefit of Section 80P of the Act would stand attracted subject to the provisions contained in Sub-Section (2) of Section 80P of the Act. 14. Further, it is to be pointed out that in terms of Sub-Section (4) of Section 80P of the Act, which was inserted vide the Finance Act, 2006 with effect from 01.4.2007 i.e from the assessment year 2007-08, the ' primary cooperative agricultural and rural development bank ' means ' a society having its area of operation confined to a taluk, the principal objec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he decision in the case of Citizen Cooperative Society Limited also observed that in the light of insertion of Sub-Section (4) to Section 80P of the Act by the Finance Act, 2006, such deduction should not be admissible to a cooperative bank and that if it is a primary agricultural credit society or a primary cooperative agriculture and rural development bank, the deduction would still be provided. 17. In the preceding paragraphs, we have pointed out the definitions of the expressions ' members ' and ' associate member ' under the TNCS Act and held that an 'associate member' is also a 'member' in terms of Section 2(16) of the TNCS Act. Furthermore, the Assessing Officer himself found that the as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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