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Income Tax Appellate Tribunal, “SMC-B” BENCH : BANGALORE
Before: SHRI A. K. GARODIA
M/s. Srisadanand Souhard Pattina Vs. The Income-Tax Officer Sahakar Niyamit, Ward-3, Near Shri Ambabhavani Temple, Vijayapur. Kirani Bazar, Talikoti, Dt. Vijayapur. PAN : AAHAS 4265 R APPELLANT RESPONDENT Assessee by : Shri. Madhukar G. Hedge, CA Revenue by : Shri. Ganesh R. Ghale, Standing Counsel for Department Date of hearing : 21.11.2019 Date of Pronouncement : 14.01.2020 O R D E R This appeal is filed by the assessee and the same is directed against the order of CIT(A), Belgaum, dated 20.05.2019 for Assessment Year 2016-17.
Although the assessee has raised as many as 6 grounds of appeal but the only grievance of the assessee is regarding disallowance of the assessee’s claim for deduction under section 80P of the IT Act, 1961 on the ground that the same cannot be given to the Co-operatives registered under KSS Act, 1997 though it is a Co-operative institution.
Page 2 of 4 3. In the course of hearing, the learned AR of the assessee submitted a copy of the Tribunal order rendered in the case of M/s. Mahalakshmi Souharda Credit Co-operative Ltd., Vs. ITO in and 2041/Bang/2019 dated 08.11.2019 and submitted that in this case, the Tribunal has followed the tribunal order rendered in the case of Siddartha Pattina Souharda Sahakari Niyamitha Vs. ITO in ITA No.1234/Bang/2019 dated 26.07.2019 and in the same order, the Tribunal has duly considered another tribunal order of Divisional Bench rendered in the case of Udaya Souharda Credit Co-operative Society Ltd., Vs. ITO in ITA No.2831/Bang/2017 dated 17.08.2018 and held that CIT(A) is not justified in holding that the assessee is not eligible for deduction under section 80P for the reason that the assessee is registered under KSS Act, 1997 and after holding so, the matter was restored back to the file of the AO to decide about allowability of deduction under section 80P of the Income Tax Act, 1961 after examining this aspect as to whether the assessee is satisfying other conditions of section 80P of Income Tax Act, 1961and pass necessary orders as per law, after providing adequate opportunity of being heard to the assessee. In the present case also, the matter should be decided on similar line. The learned DR supported the orders of the authorities below.
I have considered the rival submissions. First of all, I reproduce para No.6 of the Tribunal order cited by learned AR of the assessee having been rendered in the case of M/s. Mahalakshmi Souharda Credit Co-operative Ltd., Vs. ITO (supra). This para reads as under:
“6. From Para No. 5 of this later tribunal order of SMC Bench as reproduced above, it is seen that it is noted by the tribunal that the division bench in the earlier tribunal order has remanded the issue to the AO for fresh consideration and in the subsequent case, the AO & CIT (A) had already considered this issue in the light of the Karnataka Souharda Sahakari Act, 1997 and therefore, the Page 3 of 4 SMC Bench considered it proper to decide this issue at Tribunal level instead of restoring to AO. Hence, it is seen that the SMC bench has duly considered the earlier tribunal order of the division bench and given the reasons for deciding the issue at the tribunal level instead of remanding of this issue to AO as has been earlier done by the division bench. Hence, there is no merit in the arguments of the learned DR of the revenue. Moreover, in the present case, the issue is being decided by SMC Bench and the order of SMC bench of the tribunal is also binding on the present bench and since the earlier order of Division bench is duly considered by SMC bench, I am duty bound to follow this later tribunal order of SMC Bench. I respectfully follow this later tribunal order of SMC Bench and hold that the CIT (A) is not justified in holding that the assessee is not eligible or deduction u/s 80P for the reason that the assessee is registered under Karnataka Souharda Sahakari Act, 1997. To this extent, I set aside the order of CIT (A) in both years. After holding so, I restore the issue about allowability of deduction u/s 80P in both years to the file of the AO to decide the issue about allowability of deduction u/s 80P after examining this aspect as to whether the assessee is satisfying other conditions of section 80P of I. T. Act and pass necessary order as per law after providing adequate opportunity of being heard to the assessee in both years.”
Respectfully following this Tribunal order, I hold that learned CIT(A) is not justified in holding that the assessee is not eligible for deduction under section 80P of the IT Act, 1961 for the reason that the assessee is registered under Karnataka Souharda Sahakari Act, 1997. To this extent, I set aside the order of the learned CIT(A). After holding so, I restore the issue about allowability of deduction under section 80P of the IT Act, 1961 to the file of the AO to decide the issue about allowability of deduction under section 80P of the Income Tax
Page 4 of 4 Act, 1961 after examining this aspect as to whether the assessee is satisfying other conditions of section 80P of the Income Tax Act, 1961 and pass necessary order as per law, after providing adequate opportunity of being heard to the assessee.
In the result, assessee’s appeal for Assessment Year 2015-16 is allowed in the terms indicated above.
Pronounced in the open court on the date mentioned on the caption page.