TMI Blog2020 (4) TMI 686X X X X Extracts X X X X X X X X Extracts X X X X ..... activities of the assesseesociety. The Full Bench of the Hon ble jurisdictional High Court in the case of The Mavilayi Service Co-operative Bank Ltd. V. CIT (supra) had held that the A.O. 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. In view of the dictum laid we restore the issue of deduction u/s 80P(2) to the files of the AO to examine the activities of the assessee and determine whether the activities are in compliance with the activities of a co-operative society functioning under the Kerala Co-operative Societies Act, 1969 and accordingly grant deduction u/s 80P(2) - Appeal filed by the assessee allowed for statisti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of Chirakkal Service Co-operative Co-operative Bank Ltd. v. CIT [(2016) 384 ITR 490 (Ker.). 4. Subsequently, the CIT(A) issued notice u/s 154 of the I.T.Act proposing to rectify his order passed, in view of the subsequent judgment of the Full Bench of the Hon ble jurisdictional High Court in the case of The Mavilayi Service Co-operative Bank Ltd. v. CIT [ITA No.97/2016 order dated 19th March, 2019]. The assessee objected to the issuance of notice. However, the CIT(A) rejected the objections raised by the assessee and passed order u/s 154 of the I.T.Act, disallowing the claim of the assessee u/s 80P(2) of the I.T.Act. 5. Aggrieved by the order of the CIT(A), the assessee has filed this appeal before the Tribunal, raising t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mepco Industries Ltd. v. CIT and another (2009) 319 ITR 208 (SC). 6) The decision of the Hon ble High Court of Kerala in the case of Kil Kothagiri Tea Coffee Estate Co. Ltd., relied upon by the Hon ble CIT(Appeals) is not applicable to your appellant s case. 7) For the above and other grounds that may be submitted at the time of hearing it is prayed to the Honorable Tribunal to cancel the order u/s 154 r.w.s. 250. 6. None appeared on behalf of the assessee. However, I proceed to dispose of this appeal on merits after hearing the learned Departmental Representative. 7. I have heard the learned Departmental Representative and perused the material on record. The Hon ble Kerala High Court in the case of Kil Kotagiri Tea C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Hon ble Kerala High Court in the case of Chirakkal Service Co-operative Co-operative Bank Ltd. v. CIT (supra) . The Larger Bench of the Hon ble Kerala High Court in the case of The Mavilayi Service Co-operative Bank Ltd. v. CIT (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 co-operative society. The Hon ble High Court held that each assessment year is separate and eligibility ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er 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 726] and Perinthalmanna [363 ITR 268]. Moreover, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch of the Hon ble jurisdictional High Court in the case of The Mavilayi Service Co-operative Bank Ltd. v. CIT (supra). The CIT(A) ought not to have rejected the claim of deduction u/s 80P(2) of the I.T.Act without examining the activities of the assessee-society. The Full Bench of the Hon ble jurisdictional High Court in the case of The Mavilayi Service Co-operative Bank Ltd. V. CIT (supra) had held that the A.O. 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. In view of the dictum laid down by the Full Bench of the Hon ble jurisdictional High Court (supra), I restore the issue of deduction u/s 80P(2) to the files of th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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