TMI Blog2019 (6) TMI 1057X X X X Extracts X X X X X X X X Extracts X X X X ..... the registration certificate issued by the Registrar of Kerala Co-operative 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 assessee 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 statistical purposes. - ITA No.23 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e 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. The order of the Ld. Commissioner of Income Tax (Appeals), Thrissur in ITA No. 1292/16-17 dated 21.01.2019 for the Assessment Year 2009-10 is erroneous in law, facts and circumstances of the case. 2. The learned Commissioner of Income-tax (Appeals) has erred in deleting the disallowance of deduction of ₹ 1,16,86,150/- claimed by the assessee under section 80P(2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6. The learned CIT (Appeals) ought to have seen that the Hon. Supreme Court in the case of Sabarkhanta Zilia Kharid Vechar Sangh Ltd. Vs. CIT reported in 203 ITR 1027 (SC) had held that eligible deduction under section 80P of the Income tax Act, 1961 in respect of co-operative societies I banks doing both agricultural and non-agricultural activities should not be 100% of the gross profits of such societies etc. but should be limited to the profits generated from agricultural activities alone performed by such assessees. 7. The learned CIT (appeals) ought to have seen that the above decision of the Hon. Apex court is in sharp contrast to the decision of the Hon. High Court of Kerala in the case of M/s C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee, on the other 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 Co-operative Society classifying the assessee-society as a cooperative society. The Hon ble High Court held that each asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate to be fixed by the Registrar 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 Pa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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