9911796707
TMI Blog2020 (6) TMI 207X X X X Extracts X X X X X X X X Extracts X X X X ..... ow: The assessee is a co-operative society registered under the Kerala Co-operative Societies Act, 1969. For the assessment year 2014-2015, `Nil' return was filed after claiming deduction u/s 80P of the I.T.Act. The assessment order was passed for assessment year 2014-2015, wherein the Assessing Officer disallowed the claim of deduction u/s 80P of the I.T.Act. The reasoning of the Assessing Officer to disallow the claim of deduction u/s 80P(2)(a)(i) of the I.T.Act was that the assessee was essentially doing the business of banking, and therefore, in view of insertion of section 80P(4) of the I.T.Act with effect from 01.04.2007, the assessee will not be entitled to deduction u/s 80P of the I.T.Act. 4. Aggrieved by the order passed by the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... various dates. The Learned Income Tax Officer (AO) took the view that the appellant is not eligible for deduction U/s 80P as the appellant lend only-a small portion for agricultural' purposes and therefore cannot be claimed as a primary Agricultural society for Financial Year 2013-14. After elaborate discussion AO came to conclusion that the appellant is not eligible for deduction u/s 80P. The Income Tax Officer also mentioned about the admission of SLP by Honorable Supreme Court on 25/11/2016 against the Kerala High Court judgment in ITA 156/2014 dated 15/02/2016 in the case of Madai service cooperative bank Ltd v/s ITO. Thus the AO passed the final order on 19/12/2016 refixing the total income at Rs. 5,23,997/-. As per the audit r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellant are conducted in accordance with the objectives of the PACS and in this case the appellant failed to do the same. Hence, the appellant is not eligible for 80P deduction. Also, the assessment done by the officer in the status of AOP is acceptable as the appellant is not held as PACS. The learned CIT(A) also denied the appellant's eligibility to avail the deduction u/s 36(1)(viia). The appeal filed by the appellant was dismissed by the CIT(A) and passed an Order under section 143(3) dated 17.02.2020. It is against the illegal demand that the appellant is now before the Hon'ble Income Tax Appellate Tribunal, Kochi seeking justice based on grounds of appeal attached and other grounds and evidences that may be raised and adduc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt held that each assessment year is separate and eligibility shall be verified by the Assessing Officer for each of the assessment years. The finding of the Larger Bench of the Hon'ble High Court reads as follows:- "33. In view of the law laid down by the Apex Court in Citizen Co-operative Society [397 ITR 1] it cannot be contended that, while considering the claim made by an assessee society for deduction under Section 80P of the IT Act, after the introduction of sub-section (4) thereof, the Assessing Officer has to extend the benefits available, merely looking at the class of the society as per the certificate of registration issued under the Central or State Co-operative Societies Act and the Rules made thereunder. On such a claim f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C 726] and Perinthalmanna [363 ITR 268]. Moreover, the law laid down by the Division Bench in Chirakkal [384 ITR 490] is not good law, since, in view of the law laid down by the Apex Court in Citizen Co-operative Society [397 ITR 1], on a claim for deduction under Section 80P of the Income Tax Act, by reason of sub-section (4) thereof, the Assessing Officer has to conduct an enquiry into the factual situation as to the activities of the assessee society and arrive at a conclusion whether benefits can be extended or not in the light of the provisions under sub-section (4) of Section 80P of the IT Act. In view of the law laid down by the Apex Court in Citizen Cooperative Society [397 ITR 1] the law laid down by the Division Bench Perinthalm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the loans were disbursed, i.e., whether it is for agricultural purpose or non-agricultural purpose. In this case, such a detailed examination has not been conducted by the A.O. At the time of assessment, the judgment of the Hon'ble jurisdictional High Court in the case of Chirakkal Service Cooperative Bank Ltd. (supra) was ruling the roost and the certificate issued by the Registrar of Co-operative Society terming the assessee as a primary agricultural credit society would be sufficient for grant of deduction u/s 80P of the I.T.Act. In the light of the dictum laid down by the Full Bench of the Hon'ble Kerala High Court in the case of The Mavilayi Service Co-operative Bank Ltd. v. CIT (supra), I am of the view that there should be fresh exa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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