THE UGAR SUGAR WORKS KAMGAR & DR. SHIRGAOKAR SHAIKSHANIK TRUST NOKAR CO-OP CREDIT SOCIETY LTD,ATHANI vs. ITO, WARD - 1(3), BELGAUM

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ITA 84/PAN/2018Status: DisposedITAT Panaji18 November 2021AY 2012-133 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the appellant is a cooperative society registered under the relevant Act and does not have a banking license from the RBI. Therefore, it cannot be classified as a cooperative bank and is eligible for the Section 80P(2)(a)(i) exemption.

What were the facts?

The assessee, a cooperative society, claimed exemption under Section 80P(2)(a)(i) of the Income Tax Act. The Assessing Officer denied this exemption, classifying the society as a cooperative bank. The CIT(A) upheld this decision.

What were the issues?

Whether a cooperative society, without an RBI banking license, can be treated as a cooperative bank for the purpose of denying Section 80P(2)(a)(i) exemption.

Which sections of the Income-tax Act were involved?

Section 80P(2)(a)(i),Section 143(3)

AI-generated summary — verify with the full judgment below

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Income Tax Appellate Tribunal, PANAJI BENCH, PANAJI – VIRTUAL COURT

Before: SHRI INTURI RAMA RAO, AM & SHRI S. S. VISWANETHRA RAVI, JM

For Appellant: Shri Pramod Vaidya
Hearing: 12.11.2021Pronounced: 18.11.2021

ORDER

PER INTURI RAMA RAO, AM:

1.

This is an appeal filed by the assessee directed against the order of ld. Commissioner of Income Tax (Appeals), Gulbarga (‘CIT(A)’ for short) dated 29.12.2017 for the assessment year 2012-13.

2.

Briefly, the facts of the case are that the appellant is a cooperative society registered under the Karnataka State Co-operative Society Act, 1959 with the object of accepting deposits from its member s and providing credit facilities to its members. The return of income for the assessment year 2012- 13 was filed on 25.09.2012 declaring total income of Rs.4,03,384/- after claiming exemption u/s 80P(2)(a)(i) of the Income Tax Act, 1961 (‘the Act’) of Rs.4,09,725/-. Against the said return of income, the assessment was completed by the Income Tax Officer, Ward-1(3), Belgaum (‘the Assessing Officer’) vide order dated 27.08.2014 passed u/s 143(3) of the Act at a total income of Rs.8,82,947/-. While doing so, the Assessing Officer denied the claim of exemption u/s 80P(2)(a)(i) of the Act holding it to be cooperative bank not cooperative society.

3.

Being aggrieved by the above action of the Assessing Officer, an appeal was preferred before the ld. CIT(A), who vide impugned order confirmed the action of the Assessing Officer.

4.

Being aggrieved by the above decision of the ld. CIT(A), the assessee is in appeal before us in the present appeal.

5.

The ld. AR submits that the appellant is not a cooperative bank but a cooperative society and eligible for deduction u/s 80P(2)(a)(i) of the Act.

6.

On the other hand, ld. Sr. DR placed reliance on the orders of the lower authorities.

7.

We heard the rival submissions and perused the material on record. The only issue raised by the assessee in the grounds of appeal relates to whether the appellant can be termed as a cooperative society or cooperative bank. The undisputed position is that the appellant is registered a cooperative society under the Karnataka State Co-operative Society Act, 1959 and does not enjoy any licence from Reserve Bank of India to carry on the business of banking. It is a trite law that the assessing authority cannot go behind the registration certificate granted under the Cooperative Societies Act as held by the Hon’ble

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