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TMI Blog2020 (3) TMI 44X X X X Extracts X X X X X X X X Extracts X X X X ..... . 4. The order of assessment passed by the learned Assessing Officer is bad in law in adding a sum of Rs. 40,30,479, on protective basis, based on SLP filed by the Department before Hon'ble Supreme Court in CIT vs. Shri Biluru Gurubasava Pattina Sahakari Sangha Niyamita. 5. The learned Assessing Officer has erred in law and facts of the case, failed to appreciate that the interest income earned by the appellant out of the deposits kept in the co-operative banks are all out of the monies of the members of the appellant society, and are not out of any liability due by the society, consequently the AO ought to have allowed deduction under section 80P(2)(d), following the judgment in M/s.Tumkur Merchants Souharda Credit Co-operative decision of Hon'ble High Court of Karnataka. 6. The appellant craves leave to add, alter, amend, substitute or delete any or all of the grounds of appeal urged above. 7. For the above and other grounds to be urged during the course of hearing of the appeal the Appellant prays that the appeal be allowed in the interest of equity and justice." 3. Briefly stated the facts of the case are that the assessee is a Co-operative Society engaged in providing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esent case. Hence, I hold that this judgment of Hon'ble Karnataka High Court has no applicability in the present case in view of the facts discussed above. Regarding the argument of ld. DR of revenue that the earlier Tribunal order rendered by the Division Bench of the Tribunal in the case of M/s. Udaya Souharda Credit Cooperative Society Ltd. (supra) should be followed in preference to the later decision of SMC bench of the Tribunal rendered in the case of Siddartha Pattina Souharda Sahakari Niyamitha Vs. ITO (supra), I find that in this later case, the SMC bench of the Tribunal has duly considered the earlier decision of the Division Bench of the Tribunal rendered in the case of M/s. Udaya Souharda Credit Co-operative Society (supra) and it is also noted that ld. CIT(A) and AO in that case has examined the whole issue in the light of Karnataka Souharda Sahakari Act, 1997. Because of this reason, it was held by the SMC bench of the Tribunal that issue has to be decided by the Tribunal and it cannot be remanded to the AO as was canvassed by the Revenue and hence, this argument has not merit that even now, the matter should be restored back to the AO for fresh decision although ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e also co-operative societies within the meaning of Sec.2(19) of the Act and therefore the revenue authorities were not justified in denying the benefit of deduction to the Assessee. The learned DR relied on a decision of the ITAT Bangalore Bench in the case of M/s. Millennium Credit Cooperative Society Ltd. Vs. ITO ITA Nos. 2606 & 2607/Bang/2017 in which the Tribunal followed the decision of ITAT Bangalore Bench in the case of M/s. Udaya Souharda Credit Co-operative Society Ltd. ITA No.2831/Bang/2017 order dated 17.8.2018 in which the issue whether souharda registered under the Karnataka Souharda Sahakari Act, 1997 can be regarded as co-operative society entitled to benefit of deduction u/s.80P(2)(a)(i) of the Act was remanded to the AO for fresh consideration. We are of the view that in the present case, the AO and CIT(A) have already considered this issue in the light of the Karnataka Souharda Sahakari Act, 1997 and therefore this issue has to be decided by me and cannot be remanded to the AO as was canvassed by the Revenue. 6. I have considered the rival submissions. Sec.2(19) defines cooperative societies for the purpose of the Actand the same is as follows: "Definitions. 2. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l Planning Commission set up a committee by appointing Shri Chaudari Brahmaprakash as its head & with a task of drafting a 'Model Cooperative Act' which will prevent interference of the governments. This committee, after a detailed study of the Cooperative Acts of various states, drafted a 'Model Cooperative Act' in 1991 and Central Government recommended the state governments to adopt this. Accordingly, in 1997 a bill on parallel cooperative act was tabled in the state legislature of Karnataka. Demanding an early approval of this bill by both the houses of Karnataka Legislature, a committee 'Souharda Samvardhana Samithi' under the chairmanship of Justice Rama Jois came into existence. It was due to the combined efforts of Sahakara Bharathi Karnataka and Souharda Samvardhana Samithi, "The Karnataka Souharda Sahakari Act-1997 (KSSA, 1997)" was passed in the legislature. With the consent of The President of India, it was enforced from January 2001. Preamble to the Act reads thus:- "An Act to provide for recognition, encouragement and voluntary formation of Co-operatives based on self-help, mutual aid, wholly owned, managed and controlled by members as accountable, competitive, self-r ..... X X X X Extracts X X X X X X X X Extracts X X X X
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