ITO WARD 1(4), Nashik V. NASHIK DIST. LABOUR SOCIETIES CO-OPERATIVE FEDERATION LTD., Nashik

ITA 195/PUN/2011

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 7469 (ITAT-PUNE)
• Duration Of Justice: 1 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-03-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 15-03-2011
• Assessment Year: 2007-2008
• Appeal Filed On: 10-02-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ABHAY DAMLE

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH : 'A , PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV, JM AND SHRI D. KARUNAKARAN RAO, AM ITA NO. 195/PN/2011 : A.Y. 2007-08 I.T.O. WARD 1(4) NASIK . APPELLANT VS. NASIK DIST. LABOUR SOCIETIES CO-OP. FEDERATION LTD., SHRAM SAHAKAR, TIDKE COLONY CHUMBLE MARG, TRIMBAK ROAD, NASIK PAN AAABN 0028 M . RESPONDENT APPELLANT BY : SHRI ABHAY DAMLE RESPONDENT BY : NONE ORDER PER SHAILENDRA KUMAR YADAV, JM THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF THE CIT(A)-I NASIK DATED 10-12-2010 FOR A.Y. 2007- 08. THE ONLY GROUND RAISED BY THE REVENUE IN THIS APPEAL RE ADS AS UNDER: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) IS NOT JUSTIFIED IN HOLDING THAT THE ASSESSEE IS ENTITLED TO DEDUCTION U/S 80P(2)(A)(VI) WHEN IN FACT IT IS A DIST. FEDERATION OF LABOUR CO-OP. SOCIETIES AND T HE INCOME EARNED BY THE FEDERATION CANNOT BE SAID TO B E ATTRIBUTABLE TO COLLECTIVE DISPOSAL OF LABOUR OF IT S MEMBERS AS CONTEMPLATED IN SECTION 80P(2)(A)(VI) OF THE ACT. I.T.A. NO. 195/PN/11 NASIK DIST. LABOUR SOCIETIES CO-OPERATIVE FEDERATION LTD. A.Y. 2007-08 2 2. THE RELEVANT FACTS ARE THAT THE ASSESSEE IS A CO -OPERATIVE SOCIETY PROVIDING VARIOUS SERVICES TO ITS MEMBER SO CIETIES. THE ASSESSEE HAS FILED A RETURN OF INCOME ON 30-10-2007 DECLARING TOTAL INCOME AT RS. NIL WHICH WAS PROCESSED U/S 143 (3) OF THE ACT. ON AN EXAMINATION OF THE RETURN OF INCOME, THE ASSESSING OFFICER FOUND THAT THE ASSESSEE HAS SHOWN TOTAL REC EIPTS OF RS. 87,88,925/- WHICH INCLUDED BANK INTEREST OF RS. 28,30,894/-. THE ASSESSEE HAS CLAIMED DEDUCTIO N U/S 80P(2)(A)(D) OF THE ACT IN RESPECT OF ENTIRE BANK INTEREST OF RS. 29,30,894/- AND FURTHER CLAIMED DEDUCTION OF RS. 16,93,765/- U/S 80P(2)(A)(VI) OF THE ACT. THE A SSESSING OFFICER DISALLOWED THE ENTIRE DEDUCTION U/S 80P(2)( A)(VI) OF THE ACT AND RECOMPUTED THE DEDUCTION U/S 80P(2)(D) OF T HE ACT IN RESPECT OF BANK INTEREST BY APPORTIONING CERTAIN EX PENSES AGAINST SUCH INCOME. THE ASSESSING OFFICER THEREFO RE, ALLOWED ONLY BASIC DEDUCTION OF RS. 50,000/- U/S 80P(2)(C) OF THE ACT AND REDUCED DEDUCTION OF RS. 14,38,944/- U/S 80P(2) (D) OF THE ACT IN RESPECT OF BANK INTEREST. THUS, THE ASSESSI NG OFFICER DENIED THE ENTIRE DEDUCTION U/S 80P(2)(A)(VI) OF TH E ACT. ON APPEAL, THE CIT(A) ALLOWED THE CLAIM OF THE ASSESSE E WHICH HAS BEEN CHALLENGED BEFORE US BY THE REVENUE. 3. AFTER HEARING THE LEARNED DR AND PERUSING THE MA TERIAL ON RECORD, WE FIND THAT THE ASSESSING OFFICER HAS N OT ALLOWED THE DEDUCTION DESPITE THE FACT THAT IN ASSESSEES O WN CASE IN I.T.A. NO. 195/PN/11 NASIK DIST. LABOUR SOCIETIES CO-OPERATIVE FEDERATION LTD. A.Y. 2007-08 3 ITA NO. 1064/PN/1984 DATED 5-5-2006 FOR A.Y. 1980-8 1 THE TRIBUNAL ALLOWED THE CLAIM OF DEDUCTION U/S 80P(2) OF THE ACT. 4. WE FURTHER FIND SIMILAR DISALLOWANCES WERE MADE BY THE ASSESSING OFFICER IN SUBSEQUENT ASSESSMENT YEARS BU T THE TRIBUNAL VIDE ITS ORDER IN ITA NO. 495/PN/2006 FOR A.Y. 2003- 04 DATED 30-6-2008 AND IN ITA NO. 1336/PN/2008 FOR A.Y. 2005-06 DATED 28-11-2008 HAS CONFIRMED THE ORDERS O F THE CIT(A) IN ALLOWING THE CLAIM OF ASSESSEE. NOTHING CONTRARY WAS SBROUGHT TO OUR KNOWLEDGE ON BEHALF OF REVENUE. WE ARE THEREFORE, OF THE OPINION THAT THE CIT(A) WAS JUSTI FIED IN DIRECTING THE ASSESSING OFFICER TO ALLOW THE CLAIM OF THE ASSESSEE. THIS VIEW IS FORTIFIED BY THE JUDGMENT OF HONBLE SUPREME COURT IN THE CASE OF KERALA STATE CO-OPERAT IVE MARKETING FEDERATION LTD & OTHERS VS. CIT (231 ITR 841 (SC). WE ACCORDINGLY, UPHOLD THE ORDER OF THE CIT(A) IN A LLOWING THE CLAIM OF DEDUCTION U/S 80P(2)(A)(VI) OF THE ACT. 5. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. PRONOUNCED IN THE OPEN COURT ON 23 RD MARCH 2011. SD/- SD/- (D. KARUNAKARA RAO) (SHAILENDRA KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER PUNE DATED THE 23 RD MARCH 2011 ANKAM COPY OF THE ORDER IS FORWARDED TO : 1. ASSESSEE 2. DEPARTMENT 3. CIT(A) I PUNE 4. THE CIT I PUNE 5. THE D.R. ITAT A BENCH TRUE COPY I.T.A. NO. 195/PN/11 NASIK DIST. LABOUR SOCIETIES CO-OPERATIVE FEDERATION LTD. A.Y. 2007-08 4 BY ORDER ASSTT. REGISTRAR INCOME-TAX APPELLATE TRIBUNAL, PUNE BENCH, PUNE.