Income Tax Appellate Tribunal - Ahmedabad
The Arbuda Credit Co.Operative Society ... vs The Acit, B.K.Circle,, Palanpur on 11 July, 2018
IN THE INCOME TAX APPELLATE TRIBUNAL
"SMC" BENCH, AHMEDABAD
BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER &
Ms. MADHUMITA ROY, JUDICIAL MEMBER
I.T.A. No.2231/Ahd/2014 - AY 2011-12
And
Cross Objection No.266/Ahd/2014 - AY 2011-12
( In ITA No.2231/Ahd/2014 - AY 2011-12 )
The Asstt.CIT Vs. The Arbuda Credit Co-operative
B.K. Circle Society Ltd.
Palanpur 1 s t Floor, Tower Ganj Bazar
Shopping Centre
Dhanera, Dist.Banaskantha
[PAN No. AAAAA 1251A]
(Appellant) .. (Respondent & Cross Objector)
Revenue by : Shri Omprakash Pathak, Sr.DR
Assessee by : None
Date of Hearing 09/07/2018
Date of P ronouncement 11/ 07 /2018
ORDER
PER Ms. MADHUMITA ROY - JM:
The instant appeal and the Cross Objection have been preferred before us by the Revenue and Assessee respectively against the order dated 07.05.2014 passed by the Commissioner of Income Tax(Appeals)-XX, Ahmedabad [Ld.CIT(A) in short] for Assessment Year (AY) 2011-12 arising out of the order dated 28.01.2014 passed by the ACIT, B.K. Circle, Palanpur.
2. The main issue raised in the matter relates to the benefit u/s.80P(2)(a)(i) and u/s.80P(2)(d) of the Income Tax Act, 1961 (hereinafter referred to as "the Act").
-2- ITA No.2231/Ahd/2014 (By Revenue) &CO No.266/Ahd/2014 (By assessee) ACIT vs. The Arbuda Credit Co-op.Society Ltd.
Asst.Year - 2011-12
3. The assessee is engaged in the business of accepting deposits from its Members and providing credit facilities to its members and claimed deduction u/s.80P(2) of the Act.
3.1. The brief facts leading to the case is this that the assessee filed its return of income on 05.10.2011 declaring total income of Rs.NIL. The said return was processed u/s.143(1) of the Act and upon scrutiny notice u/s.143(2) of the Act was issued on 27.09.2012 followed by 03.09.2013 along with the questionnaire calling for certain details. The assessee produced the audited books of accounts with the P&L account, balance-sheet, capital account and supporting bills & vouchers which were examined by the AO on test check basis.
4. The assessee has shown gross total income of Rs.33,66,846/- and claimed deduction u/s.80P(2) of the Act. Under a show-cause notice dated 17.01.2014, the assessee was asked to explain as to why the deduction claimed u/s.80P(2)(a)(i) and u/s.80P(2)(d) of the Act should not be withdrawn as per amendment. In response whereof, the assessee made the following submission:
''The Arbuda Credit Co-operative Society Ltd., Dhanera is Registered under the Co- operative Society Act, bearing Registration No. S-28761 Dated. 01/07/1996.
The Co-operative Credit Society are entitled a deduction u/s. 80P(2) as our Society is not a co-operative Bank registered under the Banking Regulation Act but registered under the Co-operative Society Act, so all the provisions of Cooperative Societies Act are applicable.
Since our Credit Society is not a Co-operative Bank and consequently not hit by provisions of Section 80P(4) and as such deduction U/S. 80P(2)(a)(i) will be available to it from A. Y. 2007-08 and onwards and accordingly it was legally claimed by us a credit Co-op. Society.
Further according to the by-lows of the Co-operative Credit Society only members share holder are entitled to deposit or receive loan from the credit society and therefore principal of mutuality will apply and as such exemption claimed U/S. 80P(2)(a)(i) and as per the said provisions our Society is doing the business of credit facilities to members only and therefore exemption claimed by us is totally justified. It is proven fact that the