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TMI Blog2021 (8) TMI 994X X X X Extracts X X X X X X X X Extracts X X X X ..... )(ii) without appreciating the explanation of the Appellant that Appellant is a co-operative Society engaged in business of marketing of agricultural produce grown by its members and profit obtained from marketing of agricultural marketing of agriculture produce grown by members is eligible for deduction u/s 80P(2)(a)(iii). 3. The learned CIT(A) further failed to appreciate that the agriculturist who are growing arcanut are admitted as member and agriculturist who are not growing arcanut are not at all admitted as members. Hence the profit obtained from marketing of agriculture produce grown by members are only claimed u/s 80P(2)(a)(iii) of the Income Tax Act." 3. The facts relating to the case are stated in brief. The assessee is a Co-o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lled certain traders as nominal members. Hence, the A.O. asked the assessee to clarify as to how the assessee is entitled for deduction u/s 80P(2)(a)(iii) of the Act since the said provision requires that the produce sold by the members have to be grown by them and not grown by others. In response to the same, the assessee produced list of nominal members. It also submitted that it is engaged in the business of marketing the agricultural produce grown by its members. It further submitted that the interest income is derived from traders on the credit facility given to them and the said interest income also forms part of the process of marketing of agricultural produce and hence exempt u/s 80P(2)(a)(iii) of the Act. In this regard, the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d show that the assessee has shown following gross receipts/gross profit: a) Gross Profit from trading of fertilizers, seeds and others Rs. 17,27,701/- b) Gross Commission earned on marketing of agricultural Produce of its members Rs. 1,37,01,081/- c) Interest income received from traders Rs. 3,03,61,399/- d) Interest income received from members Rs. 3,66,57,074/- In addition to the above, the assessee has also received other miscellaneous income. 8. It is the submission of Ld. A.R. that (a) Profit from trading of fertilizers, seeds and others is deductible u/s 80P(2)(a)(iv) of the Act. (b) Commission earned on marketing of agricultural produce and interest income received from traders is deductible u/s 80P(2)(a)(i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed under the principle of consistency. The Ld. A.R. further submitted that the assessee is admitting persons as members only after satisfying itself that the said member owns agricultural lands. Only the traders, who purchases the agricultural produce are admitted as nominal members. Hence there is no reason to suspect that the agricultural produce was not grown by the members. 11. On the contrary, the Ld. D.R. submitted that the A.O. has rejected the claim for the reason that the assessee has failed to furnish the details called for by him. He submitted that the condition for allowing deduction u/s 80P(2)(a)(iii) of the Act is that the agricultural produce should have been grown by its members. The assessee has failed to prove that the ag ..... X X X X Extracts X X X X X X X X Extracts X X X X
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