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TMI Blog2021 (9) TMI 806X X X X Extracts X X X X X X X X Extracts X X X X ..... ve Act, 1997. The assessee claimed deduction under section 80P(2)(a)(i) of the Income Tax Act, 1961 (hereinafter called 'the Act'), on a sum of Rs. 2,88,21,118/-. The relevant provisions of Sec.80P(2)(a)(i) of the Act, provides for the following deduction: "Section 80P - Deduction in respect of income of Co-operative Societies: 80P. (1) Where, in the case of an assessee being a co-operative society, the gross total income includes any income referred to in sub-section (2), there shall be deducted, in accordance with and subject to the provisions of this section, the sums specified in sub-section (2), in computing the total income of the assessee. (2) The sums referred to in sub-section (1) shall be the following, namely :- (a) in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the co-operative society means a co-operative society registered under the Karnataka Co-operative Societies Act, 1959. Thus according to the AO, if both the Acts are read jointly, it would be very clear that the co-operative and cooperative Societies are two different entities. The benefit of deduction can only be given to the co-operative societies and not to the co-operative. Therefore, the assessee is not even eligible to claim deduction under section 80P(2) of the Act. 4. In coming to the above conclusion, the AO placed reliance on the decisions rendered by the ITAT Bangalore Division Bench, in the case of Udaya Souharda Credit Co-operative Society Ltd. ITA No.2831/Bang/2017 order dated 17.8.2018 in which the issue whether souharda re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erved as follows: "Since all these new points have been raised during the course of hearing before us and according to us all these points goes to the root of the case, we are of the view that proper adjudication of the issues is required by the AO. We accordingly set aside the order of the CIT(A) and resotore the matter to the AO to re-examine all these aspects by making necessary enquiry and investigation and also by passing a reasoned order in this regard. Since we have restored the matter to the AO, we find no justification to adjudicate the issue raised on merit. Accordingly, the order of the CIT(A) is set aside and matter is restored to the AO for adjudication of the impugned issue in terms indicated above." 7. Thus the issue wheth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act and therefore subject to all just exceptions, are entitled to stake their claim for the benefit of Sec.80P of the Act. 9. We have considered the rival submissions. Sec.2(19) defines co-operative societies for the purpose of the Act and the same is as follows: "Definitions. 2. In this Act, unless the context otherwise requires,- (19) "co-operative society" means a co-operative society registered under the Co-operative Societies Act, 1912 (2 of 1912), or under any other law for the time being in force in any State for the registration of co-operative societies ;" 10. The Hon'ble Karnataka High Court in the case of SwabhimaniSouharda Credit Co-operative Ltd.(supra) after considering the aforesaid definition of Co-operative so ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... noticing the statement and objects and reasons for introducing The Karnataka SouhardaSahakari Bill, 1997 has the following as the Statement of Objects & Reasons and preamble to the the Karnataka Co-operative Societies Act, 1959 and the Karnataka SouhardaSahakari Act,1997, concluded as follows: "A perusal of these two preambles and various provisions of these two Acts leads one to an irresistible conclusion that both these Acts are cognate statutes that deal with co- operative societies, regardless of some difference in their nomenclature and functionality, the subject matter being the same; (e) the word 'co-operative' is defined by sec.2(d-2) of 1959 Act as under: "2(d-2): 'Co-operative' means a Co-operative registerd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y corporate; both the entities have perpetual succession by operation of law; thus on registration be it under the 1959 Act or the 1997 Act, a legal personality is donned by them, so that inter alia they can own and possess the property; (f) the employment of the word "Sahakari" in the very title of the 1997 Act is also not sans any significance; 'Sahakaar' in Sanskrit is the equivalent of 'sahakaara' in Kannada which means 'co-operation'; as already mentioned above both the 1959 Act and the 1997 Act employ this terminology; the 1997 Act is woven with the principles of cooperation; sec.4 of this Act bars registration of an entity unless its main objects are to serve the interest of the members in the area of cooper ..... X X X X Extracts X X X X X X X X Extracts X X X X
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