ITO WARD 5, PONDICHERRY vs. MS/ CENTRAL CO OP PROCESSING SUPPLY AND MARKETING SOCIETY LTD, PONDICHERY

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ITA 418/CHNY/2018Status: DisposedITAT Chennai12 September 2018AY 2012-134 pages

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

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that marketing of agricultural commodities by a co-operative society is eligible for deduction under Section 80P(2)(iii). It also found that interest paid to a company established by the government is not subject to TDS.

What were the facts?

The Revenue appealed against the CIT(Appeals) order concerning assessment year 2012-13. The assessee, a co-operative society, claimed deduction under Section 80P(2)(iii) and also faced issues regarding non-deduction of TDS on interest paid to a government-established corporation.

What were the issues?

Whether a co-operative society marketing agricultural commodities is eligible for deduction under Section 80P(2)(iii) and whether TDS is applicable on interest paid to a government-established corporation.

Which sections of the Income-tax Act were involved?

Section 80P(2)(iii)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘D’ BENCH, CHENNAI

Before: SHRI N.R.S. GANESAN & SHRI A. MOHAN ALANKAMONY

Hearing: 13.08.2018Pronounced: 12.09.2018

आदेश /O R D E R

PER N.R.S. GANESAN, JUDICIAL MEMBER:

1.

This appeal of the Revenue is directed against the order of the Commissioner of Income Tax (Appeals), Puducherry, dated 02.11.2017 and pertains to assessment year 2012-13.

2.

No one appeared for the assessee inspite of service of notice by RPAD. Therefore, we heard the Ld. Departmental Representative and proceeded to dispose the appeal on merit.

3.

Ms. S. Vijayaprabha, the Ld. Departmental Representative, submitted that the assessee claimed deduction under Section 80P(2)(iii) of the Income-tax Act, 1961 (in short 'the Act') before the Assessing Officer. Under Section 80P(2)(iii) of the Act, the Assessing Officer can allow only ₹50,000/-. However, the CIT(Appeals) allowed the claim of the assessee under Section 80P(2)(iii) of the Act. The Ld. D.R. further submitted that the assessee-co-operative society is trading in agricultural commodities, therefore, not eligible for exemption under Section 80P(2)(iii) of the Act.

4.

We heard the Ld. Departmental Representative and perused the relevant material available on record. We have carefully gone through the provisions of Section 80P(2)(iii) of the Act. Section 80P(2)(iii) of the Act clearly says that marketing of agricultural produce grown by the members of the co-operative society is eligible for exemption under Section 80P(2)(iii) of the Act. In this case, the assessee-co-operative society is marketing agricultural commodities, therefore, the CIT(Appeals) has rightly allowed the claim of the assessee.

5.

The next issue arises for consideration is non-deduction of tax in respect of interest paid to M/s Pondicherry Industrial

6.

We heard Ms. S. Vijayaprabha, the Ld. Departmental Representative. Admittedly, M/s Pondicherry Industrial Development and Investment Corporation Ltd. was established by Government of Pondicherry. Therefore, the CIT(Appeals) has rightly found that the payment of interest to the company established by Government is not subjected to TDS. Therefore, the CIT(Appeals) has rightly allowed the claim of the assessee. This Tribunal do not find any reason to interfere with the order of the lower authority and accordingly the same is confirmed.

7.

In the result, the appeal filed by the Revenue is dismissed.

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