Income Tax Officer, Sitapur V. M/s. Shakari Ganna Vikas Samiti , Sitapur

ITA 226/LKW/2013

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 6543 (ITAT-LUCKNOW)
• Duration Of Justice: 1 year(s) 2 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-06-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 16-06-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 08-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R K RAM

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH B , LUCKNOW BEFORE SHRI S UNIL KUMAR YADAV , JUDICIAL MEMBER AND SHRI. A. K. GARODIA , ACCOUNTANT MEMBER ITA NO. 226/LKW/2013 ASSESSMENT YEAR: 2006 - 07 THE INCOME TAX OFFICER SITAPUR V. M/S SHAKARI GANNA VIKAS SAMITI SITAPUR PAN: (APP ELL ANT) (RESPONDENT) APP ELL ANT BY: SHRI. R. K. RAM, D.R. RESPONDENT BY: SHRI. SHUBHAM RASTOGI, C.A. DATE OF HEARING: 16 0 6 2014 DATE OF PRONOUNCEMENT: 25 0 6 2014 O R D E R PER SUNIL KUMAR YADAV: THIS APP EAL IS PREFERRED BY THE REVENUE AGAINST THE ORDER OF THE LD. CIT(A) ON A SOLITARY GROUND THAT THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.63,56,714/ - . 2 . THE LD. D.R. HAS PLACED RELIANCE UPON THE ORDER OF THE ASSESSING OFFICER. 3 . THE LD. COUNSEL FOR THE ASSESSEE DURING THE COURSE OF HEARING OF THE APPEAL HAS INVITED OUR ATTENTION THAT THE ASSESSEE IS A CO - OPERATIVE SOCIETY, THEREFORE, INTEREST EARNED BY IT IS EXEMPT FROM TAX UNDER SECTION 80P(2) OF THE INCOME - TAX ACT, 1961 (HEREINAFTER CALLED IN SHOR T THE ACT'). HE HAS FURTHER SUBMITTED THAT THE IMPUGNED ISSUE IS SQUARELY COVERED BY THE ORDER OF THE TRIBUNAL IN THE ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2005 - 06. COPY OF THE ORDER OF THE TRIBUNAL DATED 28.11.2008 IN I.T.A. NO.817/LUC/2008 IS PLACED ON RECORD. PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 2 - : 4 . HAVING CAREFULLY EXAMINED THE ORDERS OF THE AUTHORITIES BELOW AS WELL S THE ORDER OF THE TRIBUNAL DATED 28.11.2008 IN ASSESSEES OWN CASE IN I.T.A. NO.817/LUC/2008, WE FIND THAT THE IMPUGNED ISSUE WAS ADJUDICATED BY THE TRIBUNAL IN THE ASSESSEE S OWN CASE FOR THE IMMEDIATELY PRECEDING YEAR IN DETAIL IN THE LIGHT OF VARIOUS JUDICIAL PRONOUNCEMENTS AND HAS FINALLY CONCLUDED THAT ASSESSEE IS ENTITLED FOR EXEMPTION UNDER SECTION 80P(2) OF THE ACT. THE RELEVANT OBSERVATIONS OF THE TRIBUNAL IS EXTRAC TED HEREUNDER FOR THE SAKE OF REFERENCE: - 7. IN OUR CONSIDERED VIEW, THE RELIANCE OF THE REVENUE ON THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF PONNI SUGARS AND CHEMICALS LTD. IS MISPLACED. IT IS BECAUSE IN THAT CASE THE HON'BLE SUPREME COUR T WAS EXAMINING THE ISSUE WHETHER INTEREST RECEIVED FROM THE MEMBERS OF THE SOCIETY WOULD BE COVERED BY SECTION 80P FOR GIVING EXEMPTION TO THE ASSESSEE UNDER THAT SECTION. THE HON'BLE SUPREME COURT IN THIS JUDGMENT WAS CONSIDERING THE ALLOWABILITY OF EXE MPTION OF INTEREST RECEIVED FROM THE MEMBERS OF SOCIETY AND NOT FROM THE BANK AND POST OFFICE. NOTWITHSTANDING THE DECISION OF HON'BLE ALLAHABAD HIGH COURT IN THE CASE OF CIT VS. CANE COOPERATIVE DEVELOPMENT UNION LTD., 118 ITR 770 AND IN THE CASE OF CIT VS. KRISHAK SAHKARI GANNA SAMITI LTD., 258 ITR 594, WAS NOT CONSIDERED OR REFERRED TO IN THE ABOVE JUDGMENT. HOWEVER, THE FACTS IN THE PRESENT CASE ARE NOT IN CONFLICT WITH THE DECISION IN PONNI SUGARS AND CHEMICALS LTD. AS NOTED BY THE LD. CIT, THE ASSE SSEE SOCIETYS MAIN OBJECTS ARE AS UNDER: - ( I ) TO ENHANCE THE CULTIVATION OF SUGAR CANE CROP. ( II ) PROVIDING OF BETTER PRICE TO ITS MEMBER CANE GROWERS BY MILLS. ( III ) SUPPLY OF CANE TO SUGAR MILLS ( IV ) TO PROVIDE SEEDS, FERTILIZERS PESTICIDES, AGRICULTURAL EQUIPMENTS TO MEMB ERS. PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 3 - : ( V ) TO PROVIDE LOAN TO THE MEMBERS ( VI ) TO ARRANGE FUNDS AND FINANCE FOR ACTIVITIES OF THE SOCIETY. 8. CLAUSE (VI) EMPOWERS THE ASSESSEE TO ARRANGE FUNDS AND FINANCE FOR ACTIVITIES OF THE SOCIETY AND THIS WILL ENABLE THE ASSESSEE TO PART ITS SURPLUS FUNDS WITH THE BANKS AND EARNED INTEREST OR TO PROVIDE LOAN FACILITIES TO THE TRUST AND EARN INTEREST THEREON. FURTHER, AS HELD IN THE CASE OF CIT VS. COOPERATIVE CANE DEVELOPMENT UNION (SUPRA), THE WORD USED IN SECTION 80P IS ATTRIBUTABLE WHICH HAS WIDER MEANING THAT THE WORDS DERIVED FROM. IF AN ASSESSEE IS REQUIRED UNDER MEMORANDUM OF ASSOCIATION TO PROVIDE LOAN TO THE MEMBERS AND TO ARRANGE FUNDS AND FINANCE FOR ACTIVITIES OF THE SOCIETY THEN IT IS REQUIRED TO TAKE LOAN FROM THE BANK OR PARK SURPLUS FUNDS W ITH THE BANK AND EARN INTEREST. 9. IN VIEW OF THE ABOVE DISCUSSION, WE CONFIRM THE ORDER OF THE LD. CIT(A) AND DISMISS THE APPEAL FILED BY THE REVENUE. 5 . SINCE THE IMPUGNED ISSUE IS SQUARELY COVERED BY THE AFORESAID ORDER OF THE TRIBUNAL, FOLLOWING THE SAME WE DECIDE THE ISSUE IN FAVOUR OF THE ASSESSEE. SINCE THE LD. CIT(A) HAS ADJUDICATED THE APPEAL IN CONSONANCE WITH THE ORDER OF THE TRIBUNAL, WE FIND NO INFIRMITY THEREIN. ACCORDINGLY, WE CONFIRM THE SAME. 6 . IN THE RESULT, APPEAL OF THE REVENUE STANDS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 25.6.2014. SD/ - SD/ - [ A. K. GARODIA ] [ S UNIL KUMAR Y ADAV ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 25 TH JUNE , 2014 JJ: 1806 PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 4 - : COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT(A) 4 . CIT 5 . DR ASSISTANT REGISTRAR PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ )