TMI Blog2019 (6) TMI 1056X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer is not bound by the registration certificate issued by the Registrar of Kerala Cooperative Society classifying the assessee-society as a cooperative society. The Hon ble High Court held that each assessment year is separate and eligibility shall be verified by the Assessing Officer for each of the assessment years. The issue of deduction u/s 80P(2)(a)(i) is restored to the Assessing Officer. The Assessing Officer shall examine the activities of the assessees and determine whether their activities are in compliance with the activities of a cooperative society functioning under the Kerala Co-operative Societies Act, 1969 and grant deduction u/s 80P(2) in accordance with law. - Appeals filed by the Revenue are allowed for statistic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessment, the assessee filed appeal before the first appellate authority. The CIT(A) by following the judgment of the Hon ble jurisdictional High Court in the case of Chirakkal Service Co-operative Bank Ltd. (384 ITR 490) allowed the claim of deduction u/s 80P of the I.T.Act. 5. Aggrieved by the orders of the CIT(A), the Department has filed the present appeals before the Tribunal. The common grounds raised in these appeals read as follows: 1. In view of the recent decision of the Hon'ble High Court of Kerala in ITA No : 97 of 2016 dated 09.07.2018, referring the issue of deduction u/s. 80P to a larger bench, isn't the order of CIT(A) against law and the facts and circumstances of the case? ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e same issue, the issue should be referred to a larger bench relying on the decision of the Apex Court in the case of M/s Victory Aqua Farm Ltd. Therefore, the issue of deduction u/s. 80P has not attained finality. In this scenario, isn't the order of the CIT(A) relying on the decision of one division bench of the Hon'ble High Court in the case of M/s Chirakkal Service Co-Operative Bank Ltd without merits when there existed another division bench decision of the High Court which was favourable to the revenue? 3. The CIT(A) should have appreciated the fact that the Hon'ble Apex Court in the case of M/s The Citizen Co-Operative Society Limited Vs Assistant Commissioner of Income Tax, Circle- 9(1), Hyderabad has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pex Court's decision is in sharp contrast to the decision of the Kerala High Court in the case of M/s Chirakkal Service Cooperative Bank others in ITA 212 of 2013 that held that the authorities under the Income Tax Act cannot probe into the question of whether the assessee Cooperative society is a primary agricultural credit society once it is registered and classified as primary agricultural credit society by the competent authorities under the provisions of the Kerala Co operative Societies Act,1969 . 6. The learned CIT(Appeals) ought to have seen that the Honourable Supreme Court in the case of Sabarkantha Zilla Kharid Vechan Sangh Ltd Vs CIT reported in 203 ITR1027 (SC) had held that the eligible deduction under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hand, supported the orders of the CIT(A). 7. We have heard the rival submissions and perused the material on record. The Larger Bench of the Hon ble jurisdictional High Court in the case of The Mavilayi Service Co-operative Bank Ltd. (supra) held that the Assessing Officer has to conduct an inquiry into the factual situation as to the activities of the assessee society to determine the eligibility of deduction u/s 80P of the I.T.Act. It was held by the Hon ble High Court that the Assessing Officer is not bound by the registration certificate issued by the Registrar of Kerala Cooperative Society classifying the assessee-society as a cooperative society. The Hon ble High Court held that each assessment year is separate and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... trar of Co-operative Societies under the KCS Act and having its area of operation confined to a Village, Panchayat or a Municipality and as such, they are entitled for the benefit of sub-section (4) of Section 80P of the IT Act to ease themselves out from the coverage of Section 80P and that, the authorities under the IT Act cannot probe into any issues or such matters relating to such societies and that, Primary Agricultural Credit Societies registered as such under the KCS Act and classified so, under the Act, including the appellants are entitled to such exemption. 34. In Chirakkal [384 ITR 490] the Division Bench expressed a divergent opinion, without noticing the law laid down in Antony Pattukulangara [2012 (3) KHC 7 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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