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TMI Blog2021 (10) TMI 571X X X X Extracts X X X X X X X X Extracts X X X X ..... hes can be attributed to the assessee and there is sufficient cause in filing this appeal belatedly. Accordingly, I condone the delay in filing this appeal and proceeded to dispose of the case on merits. 3. The grounds raised read as follows:- "1. The order of the Hon'ble Commissioner of Income Tax (Appeals) is opposed to law and facts of the case. 2. The Hon'ble Commissioner of Income Tax (Appeals) ought to have appreciated that the appellant is a Cooperative Society registered under the Karnataka Souharda Sahakari Act, 1997 and the appellant is eligible for deduction u/s 80P(2)(a)(i) of the Act. 3. The Hon'ble Commissioner of Income Tax (Appeals) ought to have granted the deduction u/s 80P(2)(a)(i) as claimed by the Appellant. 4. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 80P(4) of the I.T.Act is invoked, the assessee is not entitled to any deduction u/s 80P of the I.T.Act. 5. Aggrieved, the assessee preferred an appeal to the first appellate authority. The CIT(A) partly allowed the appeal of the assessee. As regards the claim of deduction u/s 80P(2)(a)(i) of the I.T.Act is concerned, the CIT(A) directed the A.O. to verify and allow the deduction u/s 80P(2)(a)(i) of the I.T.Act in respect of income earned by providing credit facilities to its regular members (regular members means members having equal voting and dividend rights). In giving the above direction, the CIT(A) followed the judgment of the Hon'ble Apex Court in the case of The Citizen Co-operative Society Ltd. v. ACIT reported in 397 ITR 1 (SC). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le Apex Court after considering the judicial pronouncements on the subject, had stated the term "member" has not been defined under the Income-tax Act. It was, therefore, stated by the Hon'ble Apex Court that the term "member" in the respective State Co-operative Societies Acts under which the societies are registered have to be taken into consideration. The Hon'ble Apex Court held that if nominal / associate member is not prohibited under the said Act, for being taken as a member, the income earned on account of providing credit facilities to such member also qualify for deduction u/s 80P(2)(a)(i) of the I.T.Act. It was further held by the Hon'ble Apex Court that section 80P(4) of the I.T.Act is to be read as a proviso. It was stated by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... examined in the light of principles laid down by the Hon'ble Supreme Court in Mavilayi Service Cooperative Bank Ltd. (surpa). Accordingly, we remit this issue of deduction u/s 80P(2)(a)(i) of the Act to the files of Ld.AO to examine the same de novo in the light of the above judgment. Needless to say that proper opportunity of being heard is to be granted to assess in accordance with law." 8.1 In view of the order of the ITAT, which is identical to the facts of the case, I restore the issue of claim of deduction u/s 80P of the I.T.Act to the files of the A.O. for de novo consideration. 8.2 As regards the claim of deduction u/s 80P(2)(d) of the I.T.Act, I direct the A.O. to verify whether interest / dividend is received by the assessee ou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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