TMI Blog2021 (10) TMI 164X X X X Extracts X X X X X X X X Extracts X X X X ..... a sahakari Act, 1997 cannot be regarded as a co-operative society under the Act. The order of the CIT(A) is accordingly set aside with a direction to the CIT(A) will decide the issue on merits in accordance with law - Appeal by the assessee is treated as allowed for statistical purpose. - ITA No.880/Bang/2019 - - - Dated:- 30-9-2021 - Shri N. V. Vasudevan, Vice President And Shri Chandra Poojari, Accountant Member For the Assessee : Shri. Srinivasa Kamath, CA For the Revenue : Shri. Sankar Ganesh, JCIT(DR)(ITAT), Bangalore ORDER PER N. V. VASUDEVAN, VICE PRESIDENT This appeal is by the assessee against the order dated 18.02.2019 of CIT(A), Bangalore, relating to AY 2015-16. 2. The assessee is a souharda cred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on investments have to be treated as income from other sources and not income from business and therefore not eligible for deduction under section 80P(2)(d) of the Act. The assessee claimed expenses on earning interest income and in this regard filed a calculation of cost of funds and interest received by the assessee and claimed that the cost of funds was much more than the interest earned and therefore interest income is not chargeable to tax. The AO did not make any specific reference to the aforesaid plea in his order. Ultimately, the assessment was completed by denying the deduction under section 80P(2)(a)(i) and 80P(2)(d) of the Act. 4. Assessee preferred an appeal before the CIT(A). The CIT(A) took the view that the assessee was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act declared that the entities registered under the Karnataka Souharda Sahakari Act, 1997 fit into the definition of Co-operative Society as enacted in Sec.2(19) 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. The learned DR relied on the order of the CIT(A). 6. We have considered the rival submissions. Sec.2(19) defines cooperative 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sprudence vide UJAGAR PRINTS, ETC. vs. UNION OF INDIA, AIR 1989 SC 516; Chapter X of 1997 Act containing sec.67 enacts important co-operative principles that animate and brood through almost all the provisions of this Act; (ii) After noticing the statement and objects and reasons for introducing The Karnataka Souharda Sahakari Bill, 1997 has the following as the Statement of Objects Reasons and preamble to the Karnataka Co-operative Societies Act, 1959 and the Karnataka Souharda Sahakari 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 so ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act provides that the entity registered as a 'co-operative' shall be a body corporate, notwithstanding the conspicuous absence of the word 'society' as a postfix; sec.9 of the 1959 Act makes the entity once registered u/s.8 thereof a body 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 abo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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