SECRETYARY, PANATHADY SERVICE CO-OP BANK LTD,KASARGODE vs. THE ITO, WARD-2, KASARGODE, KASARGODE
What did the Tribunal hold?
The Tribunal held that since the Assessing Officer and CIT(A) did not provide specific reasons for denying deduction on trade income and CAMPCO income, the case should be remanded to the AO for fresh consideration. Similarly, the issue of insurance commission was also remanded for de novo consideration.
What were the facts?
The assessee, a primary agricultural credit society, claimed deduction under Section 80P(2) for trade income and income from CAMPCO. The Assessing Officer denied this deduction due to the insertion of Section 80P(4). The CIT(A) allowed deduction for the main business but denied it for trade income and CAMPCO income.
What were the issues?
Whether trade income and income from CAMPCO are eligible for deduction under Section 80P(2). Whether insurance commission is eligible for deduction under Section 80P(2).
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
Cases cited in this judgment(1)Show listHide list
Detected automatically from the text. Citations are also linked where they appear in the judgment. The count shows how many other judgments on BharatTax rely on the same authority.
- Co-operative Bank Ltd. v. CIT631 citing384 ITR 490 · 2016 · HC
Income Tax Appellate Tribunal, COCHIN BENCH, COCHIN
Before: Shri Chandra Poojari, AM & Shri George George K, JM
Heard together (5 matters)
Read from the judgment's own cause title. This page is filed under one of them.
Per Bench
These appeals at the instance of the assessee are directed against the consolidated order of the CIT(A) dated 15.07.2017. The relevant assessment years are 2007-2008, 2007-2008, 2011-2012, 2012-2013 and 2013-2014. Since common issues are raised in these cross appeals, they were heard together and are being disposed off by this consolidated order.
ITA No.574/Coch/2017 & Ors. 2 The Secretary, The Panathady SCB Ltd. 2. The common issue that is raised in all these five appeals is whether the trade income and income from CAMPCO is entitled to deduction u/s 80P(2)(a) of the Income-tax Act, 1961.
The brief facts in relation to the above issue are as follows:
The assessee is a primary agricultural credit society registered under the Kerala Co-operative Societies Act, 1969. For the assessment years 2007-2008, 2008-2009, 2011-2012, 2012-2013 and 2013-2014, the returns were filed claiming deduction u/s 80P(2) of the I.T.Act. The assessments were completed for the concerned assessment years by denying the deduction claimed u/s 80P(2) of the I.T.Act. The reason of the Assessing Officer to deny the benefit of deduction u/s 80P(2) of the I.T.Act was that the assessee was primarily engaged in the business of banking and by virtue insertion of section 80P(4) of the I.T.Act with effect from 01.04.2007, the assessee was not entitled to deduction claimed u/s 80P(2) of the I.T.Act.
Aggrieved by the assessments completed for the concerned assessment years, the assessee had preferred appeals to the first appellate authority. The CIT(A) following the judgment of the Hon’ble jurisdictional High Court in the case of The Chirakkal Service Co-operative Bank Ltd. and Others [(2016) 384 ITR 490 (Ker.)] held that the assessee was entitled to the benefit of deduction u/s 80P(2) of the Act.
ITA No.574/Coch/2017 & Ors. 3 The Secretary, The Panathady SCB Ltd. However, with regard to the trade income and income received from CAMPCO, the CIT(A) denied the benefit of deduction u/s 80P(2) of the I.T.Act. [Para 7 of the impugned order of the CIT(A)].
Aggrieved by the order of the CIT(A), the assessee has filed the present appeals before the Tribunal. The learned AR submitted that the trade income was earned by the assessee- society on purchase and sale of agricultural implements, seeds, livestock or other articles for supplying them to its members. Further it was submitted that income received by the assessee-society from CAMPCO was for marketing of agricultural produce of its members. Therefore, it was submitted that such income was entitled to deduction u/s 80P(2)(a)(iii) and (iv) of the I.T.Act. The learned DR present was heard.
We have heard the rival submissions and perused the material on record. The Assessing Officer has disallowed the entire claim of deduction. There was no specific reasoning given by the assessee nor the CIT(A) for denying the benefit of deduction u/s 80P(2) of the I.T.Act. The trade income according to the assessee was earned by it on account of purchase and sale of agricultural implements, seeds, livestock or other articles intended for agriculture for the purpose of supplying them to its members. Income accrued from CAMPCO according to the assessee was on account of marketing of agriculture produce of its members. Therefore, it
ITA No.574/Coch/2017 & Ors. 4 The Secretary, The Panathady SCB Ltd. was submitted that such income was entitled to deduction u/s 80P(2)(a)(iii) and (iv) of the I.T.Act. Since the A.O. nor the CIT(A) has not given any specific reasons for denying the benefit of deduction claimed u/s 80P(2) of the I.T.Act, we deem it appropriate to remand the case to the A.O. for fresh consideration. The assessee shall prove with necessary evidence that the trade income it had earned and the income it had received from CAMPCO was entitled to deduction u/s 80P(2) of the I.T.Act.
6.1 As regards the insurance commission assessee had received concerning the assessment years 2011-2012 and 2012-2013, there was no discussion by the A.O. nor the CIT(A) for disallowing the claim of deduction u/s 80P(2). It is the case of the assessee that it had earned commission from United India Insurance for crop insurance where the assessee-society was intermediary between the Insurance company and its members. It was submitted that it is part of the normal business activities of the assessee and was entitled to deduction u/s 80P(2) of the I.T.Act Since there was no discussion by the A.O. nor by the CIT(A), we deem it appropriate to remit the issue to the Assessing Officer for de novo consideration. It is ordered accordingly.
In the result, the appeals filed by the assessee are allowed for statistical purposes.
ITA No.574/Coch/2017 & Ors. 5 The Secretary, The Panathady SCB Ltd.
Order pronounced on this 23rd day of July, 2018.
Sd/- Sd/- (Chandra Poojari) (George George K.) ACCOUNTANT MEMBER JUDICIAL MEMBER
Cochin ; Dated : 23rd July, 2018. Devdas*
Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. The CIT (Appeals)-Kozhikode. 4. The Pr.CIT Kozhikode. 5. DR, ITAT, Cochin 6. Guard file.
BY ORDER,
(Asstt. Registrar) ITAT, Cochin
Similar judgments
Other orders that rely on the same authority or decide the same section.
- Edavilangu Service Co-Operative Bank Ltd No… vs ITO, Ward-2(1), ThrissurCochin21 Feb 2025Remanded
Also relies on Co-operative Bank Ltd. v. CIT
The Tribunal held that the assessee is a cooperative society, not a cooperative bank, and therefore Section 80P(4) is not applicable. However, interest income earned from non-members is not eligible for deduction under S...
- Erumapetty Panchayath Service Co-Op Bank… vs The ITO, GuruvayurCochin20 May 2022Remanded
Also relies on Co-operative Bank Ltd. v. CIT
The Tribunal held that belated filing of returns does not disentitle the assessee to deduction under Section 80P, citing the jurisdictional High Court's decision. Regarding the merits, the Tribunal restored the issue of ...
- The Mundoor Service Co-Op Bank Ltd, Thrissur vs The ITO, ThrissurCochin7 Oct 2020Remanded
Also relies on Co-operative Bank Ltd. v. CIT
The Tribunal noted that the jurisdictional High Court's decision in Chirakkal Service Co-operative Bank Ltd. was followed by the CIT(A) initially. However, the subsequent Full Bench decision in The Mavilayi Service Co-op...
- Enadimangalam Service Co-Op Bank Ltd… vs The ITO, KollamCochin6 Oct 2020Remanded
Also relies on Co-operative Bank Ltd. v. CIT
The Tribunal condoned the delay in filing the appeal. It noted that the High Court's decision in Mavilayi's case was pending before the Supreme Court and that the assessee's eligibility for deduction under Section 80P ne...
- M/S.Kodur Service Co-Op Bank Ltd, Kodur… vs The ITO, TirurCochin6 Oct 2020Remanded
Also relies on Co-operative Bank Ltd. v. CIT
The Tribunal noted that the jurisdictional High Court's decision in Chirakkal Service Co-operative Bank Ltd. was initially followed by the CIT(A). However, a subsequent Full Bench decision in Mavilayi Service Co-operativ...
More judgments on Section 80P(2)
- The Mrutyunjaya Large Size Co Operative… vs Income Tax Officer, Ward-1, PalakolITA 839/VIZ/2025[2022-23]Status: Disposed24 Jul 2026AY 2022-23
- Surathkal Vyavasaya Seva Sahakari Bank… vs Income Tax Officer, Ward-1(1), MangaloreITA 2299/BANG/2025[2020-21]Status: Disposed11 May 2026AY 2020-21
- Surathkal Vyavasaya Seva Sahakari Sangha… vs Income Tax Officer, Ward-1(1), MangaloreITA 2298/BANG/2025[2018-19]Status: Disposed11 May 2026AY 2018-19
- Surathkal Vyavasaya Seva Sahakari Sangha… vs Income Tax Officer, Ward-1(1), MangaloreITA 2297/BANG/2025[2017-18]Status: Disposed11 May 2026AY 2017-18
- Mumbai Vidi Tambakhu Vyapari Sahakari… vs Income Tax Officer, Ward 22(2)(2), Piramal…ITA 1801/MUM/2026[2014-15]Status: Disposed7 May 2026AY 2014-15
Latest GST High Court judgments
Search GST case law →- Ankil Jagdishchandra Kholwadwala vs. Union Of INDIA And AnrBombay · 22 Oct 2026
- Imtiyaz Shaikh Z Chorlekar vs. Salman ShaikhBombay · 21 Oct 2026
- S. Nithyananda vs. State Of KarnatakaKarnataka · 17 Oct 2026
- Venkadeswara Grill Works vs. The Joint Commissioner (St)Madras · 16 Oct 2026
- Mufti Clothing And Co vs. The Assistant Commissioner (St)Madras · 16 Oct 2026
