TMI Blog2018 (6) TMI 1710X X X X Extracts X X X X X X X X Extracts X X X X ..... titled to such benefit. A reading of clause (a) under section 36 (1)(viia) would dispel any doubts regarding such inclusion. The deduction in respect of any provision for bad and doubtful debts to the extent of 7 % of the total income is applicable to scheduled banks not being one incorporated outside India, a non scheduled bank or a co-operative bank other than those specified. Under the second limb the deduction is to the extent of 10% of the aggregate average advances by the rural branches of such bank. The rural branches of the category of banks referred to in the first limb would be entitled under the second limb. We agree with the decision and there is no reason for us to take a different view in the present case especially in an a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Whether the decision of the Division Bench in Kannur District Co-operative Bank Lt., v. Commissioner of Income Tax (2014) 365 ITR 343 (Ker.) requires to be reconsidered ?. 2. We hence would not refer to any facts. If there is a reconsideration possible, then, we have to refer it to a Larger Bench. If not, the appeal has to be simply rejected. We have to notice the history of the deductions as available to Co-operative Banks. All Co-operative Banks were granted deduction under Section 80P of the Act, by reason of which, they stood excluded from the deductions as available under Section 36. On 1.4.2007, the deduction applicable under Section 80P was sought to be confined to Primary Agricultural Credit Societies and Primary Co-o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed the citus for determination of population as a place which has a population of not more than ten thousand according to the last preceding census of which the relevant figures have been published before the first day of the previous year . A place with reference to rural area as referred to in the census report was found to be a Revenue Village with definite survey boundaries. The legislature having adopted population as the basis for classification of rural branches, with specific reference to the last census report, the Division Bench held that, the basic unit as available for identification of rural area, in the census report can be legitimately adopted . ( Sic page 608) 4. The revenue village being treated as a unit of rural are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... advances made by the rural branches of such bank computed in the prescribed manner. xxx xxx xxx xxx Explanation- [(ia)] rural branch means a branch of a scheduled bank [or a non-scheduled bank] situated in a place which has a population of not more than ten thousand according to the last preceding census of which the relevant figures have been published before the first day of the previous year. 7. We notice that when making amendments in 2007; confining the benefit under Section 80 P to certain types of co-operative banks and granting such benefit to other 'Co-operative Banks' under Section 36; there was no specific inclusion of a Co-operative bank in the definition of rural branch. The benefit under Section 36(1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al income is applicable to scheduled banks not being one incorporated outside India, a non scheduled bank or a co-operative bank other than those specified. Under the second limb the deduction is to the extent of 10% of the aggregate average advances by the rural branches of such bank. The rural branches of the category of banks referred to in the first limb would be entitled under the second limb. We agree with the decision and there is no reason for us to take a different view in the present case especially in an appeal instituted by another assessee. 9. The question raised is also as to the sustainability of the dictum in Kannur District Co-operative Bank , that while identifying the 'rural branches', the co-operative ban ..... X X X X Extracts X X X X X X X X Extracts X X X X
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