SHRI SAI CREDIT SOUHARDA SAHAKARI NIYAMIT,CHIKODI vs. INCOME TAX OFFICER, WARD - 1, NIPANI

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ITA 265/PAN/2019Status: DisposedITAT Panaji21 November 2022AY 2016-174 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 societies registered under the Karnataka Souhardha Sahakari Act, 1997, are indeed cooperative societies within the meaning of Section 2(19) of the Income Tax Act. Therefore, the disallowance of Section 80P deductions was incorrect.

What were the facts?

The assessees, registered under the Karnataka Souhardha Sahakari Act, 1997, claimed deductions under Section 80P. The lower authorities disallowed these claims, arguing that they were not cooperative societies as defined under Section 2(19) of the Income Tax Act.

What were the issues?

Whether a society registered under the Karnataka Souhardha Sahakari Act, 1997, qualifies as a cooperative society for the purpose of Section 80P deduction.

Which sections of the Income-tax Act were involved?

Section 80P,Section 2(19)

AI-generated summary — verify with the full judgment below

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Income Tax Appellate Tribunal, PANAJI BENCHE : PANAJI

Before: SHRI SATBEER SINGH GODARA

Hearing: 17.11.2022Pronounced: 21.11.2022

Heard together (2 matters)

ITA.No.265/PAN/2019
ITA.No.18/PAN/2020

Read from the judgment's own cause title. This page is filed under one of them.

2 ITA.No.265/Pan/2019 & ITA.No.18/Pan/2020 Shri Sai Credit Souharda SahakariNiyamit, Chikodi & Shri Veerrani Mallamma Urban Credit Souharda Sahakari Ltd., Belgavi. ORDER PER SATBEER SINGH GODARA, J.M.

These twin assessees’ as many appeals ITA.No.205/Pan/2019 and ITA.No.18/PAN/2020, both for assessment year 2016-17, arise against the CIT(A)’s Belgaum’s separate orders dated 19.07.2019 and 11.12.2019, passed in Case No.CIT(A)/BGM/10368/2018-19 and CIT(A)/BGM/10190/2018-19; respectively, in proceedings u/s. 143(3) of the Income Tax Act, 1961 (in short "the Act").

2.

Heard the assessees as well as the department. Case files perused.

3.

It emerges during the course of hearing that these assessee’s have raised their identical sole substantive grievance challenging correctness of both lower authority’s action disallowing section 80P deduction claims of Rs.8,68,573/- and Rs.26,70,100/- respectively; for the sole reason that Saouhard credit co-operative society is not a cooperative society within the meaning of section 2(19) of the Act.

3 ITA.No.265/Pan/2019 & ITA.No.18/Pan/2020 Shri Sai Credit Souharda SahakariNiyamit, Chikodi & Shri Veerrani Mallamma Urban Credit Souharda Sahakari Ltd., Belgavi.

4.

I have given my thoughtful consideration to rival pleadings against and in respect of the impugned identical disallowance. Learned DR vehemently argued that both the lower authorities have rightly rejected the assessee’s impugned deduction claims u/s. 80P(2)(a)(i) since they are registered societies under the Karnataka Souhardha Sahakari Act, 1997 only than under the Karnataka Cooperative Society Law and, therefore, same deserves to be upheld.

4.1. All these Revenue’s arguments hardly deserve to be accepted. It emerges during the course of hearing that hon’ble jurisdictional high court’s decision in Government of India, Ministry of Finance vs., Karnataka State Souharda Federal Cooperative Ltd., [2022] 134 taxmann.com 170 (Kar.) has decided the very issue in assessee’s favour and against the department thereby holding that such cooperative societies registered under the Karnataka Souhadra Sahakari Act, 1997 very well come under the purview of a cooperative society defined u/s.2(19) of the Act. That being the case, I accept the instant twin assessee’s identical sole substantive

4 ITA.No.265/Pan/2019 & ITA.No.18/Pan/2020 Shri Sai Credit Souharda SahakariNiyamit, Chikodi & Shri Veerrani Mallamma Urban Credit Souharda Sahakari Ltd., Belgavi. ground in very terms. Necessary computation shall follow as per law.

5.

No other ground or argument has been pressed during the course of hearing.

6.

These twin assessee’s as many appeals are allowed in above terms. A copy of this common order be placed in respective case files.

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