Credit Co-Operative Society Providing Credit Facilities to its Members is Eligible for Sec 80P Deduction: ITAT [Read Order]
![Credit Co-Operative Society Providing Credit Facilities to its Members is Eligible for Sec 80P Deduction: ITAT [Read Order]](https://www.taxscan.in/wp-content/uploads/2017/11/Credit-Co-Operative-Society-Taxscan.jpg "Credit Co-Operative Society Providing Credit Facilities to its Members is Eligible for Sec 80P Deduction: ITAT [Read Order]")
The Income Tax Appellate Tribunal Bangalore bench while dismissing revenues appeal recently ruled that Credit co-operative society engaged in providing credit facilities, etc., to its members is eligible for deduction under Section 80P of the Income Tax Act, 1961. In the instant case, the assessee, a credit co-operative society providing credit/loan facilities to its members and...
The Income Tax Appellate Tribunal Bangalore bench while dismissing revenues appeal recently ruled that Credit co-operative society engaged in providing credit facilities, etc., to its members is eligible for deduction under Section 80P of the Income Tax Act, 1961.
In the instant case, the assessee, a credit co-operative society providing credit/loan facilities to its members and accepting deposits from them, filed its return of income declaring total income of Rs.19,039/- after claiming deduction of Rs.2,57,77,021/- under Section 80P(2)(a)(i) of the Income Tax Act, 1961.
During the examination AO was of the view that the assessee credit co-operative society is in fact a bank as per sec. 5 (ccv) of the Banking Regulation Act, 1949 and the claim of deduction proposed by assessee would not attract the present income.
Aggrieved, the assessee preferred on appeal before the CIT(A)-2, Bangalore and in support of its claim for 80P(2)(a)(i) deduction and the CIT (A) allowed the assessee’s claim for deduction.
Aggrieved by the order of the CIT (A)-2, Bangalore for assessment year 2012-13, Revenue has field this appeal before the Tribunal.
While hearing the contentions and perused and carefully considered the material on record; the bench found that the instant issue squarely covered in favour of assessee and against Revenue and relied on the decision of the Karnataka High Court in the case of CIT Vs. Sri Biluru Gurubasava Pattina Sahakari Sanagha Niyamitha wherein it was held that a co-operative society providing credit etc., to its members cannot be treated as a ‘co-operative bank’ carrying on banking activities.
Following the decision, the bench including Judicial Member Sunil Kumar Yadav and Accountant Member Jason P Boaz held that a cooperative society involved in extending credit facilities to its, members are eligible for deduction under section 80P.
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