The Assistant Commissioner of Income Tax, Circle-2(1), Panaji., Panaji V. The Jana Utkarsh Urban Co-op. Society Ltd., Mapusa

ITA 362/PAN/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 3078 (ITAT-PANAJI)
• Duration Of Justice: 3 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-01-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 20-01-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 01-10-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR S SUNDARESAN LD
• Keywords: Question of law

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PANAJI BENCH, PANAJI BEFORE SHRI NARENDRA S. SAINI , HONBLE ACCOUNTANT MEMBER AND SHRI GEORGE MATHAN , HONBLE JUDICIAL MEMBER IT A NO. 363 /PNJ/201 5 : (ASST. Y R : 200 9 - 10 ) ASST. COMMISSIONER OF INCOME TAX, CREDIT CIRCLE 2 (1) , PANAJI , GOA ( APPELLANT) VS. THE JANA UTKARSH URBAN CO - OPERATIVE SOCIETY LTD , A - 2, SHWETA RESIDENCY, KHORLIM, MAPUSA, GOA. PAN : A A AAT9547Q . (RESPONDENT) ITA NO. 366/PNJ/2015 : (ASST. YR : 2011 - 12) INCOME TAX OFFICER , WARD 2(5) , PANAJI , GOA ( APPELLANT) VS. THE SAHAKAR URBAN CREDIT CO - OPERATIVE SOCIETY LTD, 1 ST FLOOR, ROSEMARC BLDG., ABOVE SYNDICATE BANK, VASCO - DA - GAMA, GOA. PAN : AABAT6854B. (RESPONDENT) ITA NO S . 358 TO 360/PNJ/2015 : (ASST. YRS : 2008 - 09, 2009 - 10 & 2011 - 12 ) INCOME TAX OFFICER , WARD 1 (5) , PANAJI , GOA ( APPELLANT) VS. THE AZMANE URBAN CO - OPERATIVE CREDIT SOCIETY LTD, PANCHAYAT BUILDING , TITO , MANDUR, TISWADI , GOA. PAN : AABAT 2923P . (RESPONDENT) ITA NOS. 361,362,364 & 365/PNJ/2015 : (ASST. YRS : 2007 - 08, 2008 - 09, 2009 - 10 & 2012 - 13) ASST. COMMISSIONER OF INCOME TAX, CREDIT CIRCLE 2(1) , PANAJI , GOA ( APPELLANT) VS. THE JANA UTKARSH URBAN CO - OPERATIVE SOCIETY LTD, A - 2, SHWETA RESIDENCY, KHORLIM, MAPUSA, GOA. PAN : AAAAT9547Q. (RESPONDENT) 2 ITA NO . 363/PNJ/2015, ITA NO.366/PNJ/2015, I TA NOS. 358 TO 360/PNJ/2015, ITA NOS.361,362, 364 & 365/PNJ/2015, ITA NOS. 367 TO 369/PNJ/ 2015, IT A NOS. 370 TO 373/PNJ/2015, ITA NO.374/ PNJ/ 2015 & ITA NO.357/PNJ/2015 (ASST. YR : 2009 - 10), (ASST. YR : 2011 - 12), (ASST. YRS : 2008 - 09, 2009 - 10 & 2011 - 12), (ASST. YRS : 2007 - 08, 2008 - 09 ,2009 - 10 & 2012 - 13), (ASST. YRS : 2007 - 08, 2008 - 09 & 2012 - 13), (ASST. YRS : 2007 - 08, 2008 - 09, 2009 - 10 & 2012 - 13), (ASST. YR :2012 - 13) & (ASST. YR :2010 - 11) ITA NOS. 367 TO 369/PNJ/2015 : (ASST. YRS : 2007 - 08, 2008 - 09 & 2012 - 13) ASST. COMMISSIONER OF INCOME TAX, CIRCLE 2(1) , PANAJI , GOA ( APPELLANT) VS. M/S. BICHOLIM GOVT. EMPLOYE E S CO - OPERATIVE CREDIT SOCIETY LTD, RIGHT WING, GROUND FLOOR, BUS STAND, GOVT. MULTIPURPOSE BLDG, BICHOLIM, GOA. PAN : AAAAB2166R. (RESPONDENT) ITA NOS. 370 TO 373/PNJ/2015 : (ASST. YRS : 2007 - 08, 2008 - 09, 2009 - 10 & 2012 - 13) ASST. COMMISSIONER OF INCOME TAX, CIRCLE 2(1) , PANAJI , GOA ( APPELLANT) VS. THE SESA GOA EMPLOYEE S CO - OPERATIVE CREDIT SOCIETY LTD, C/O. SESA GOA LTD, SANQUELIM - GOA. PAN : AAAAT6226C. (RESPONDENT) ITA NO. 374/PNJ/2015 : (ASST. YR : 2012 - 13) ASST. COMMISSIONER OF INCOME TAX, CIRCLE 1(1) , PANAJI , GOA ( APPELLANT) VS. M/S THE GOA STATE CO - OPERATIVE BANK LTD, DAYANAND SMURTI BLDG., DR. A.B. ROAD, PANAJI - GOA. PAN : AAAAT3364R. (RESPONDENT) ITA NO. 357/PNJ/2015 : (ASST. YR : 2010 - 11) INCOME TAX OFFICER , WARD 2(2) , PANAJI , GOA ( APPELLANT) VS. THE SANKHALI URBAN CO - OPERATIVE CREDIT SOCIETY LTD, GOKULWADI, SANQUELIM, GOA. 3 ITA NO . 363/PNJ/2015, ITA NO.366/PNJ/2015, I TA NOS. 358 TO 360/PNJ/2015, ITA NOS.361,362, 364 & 365/PNJ/2015, ITA NOS. 367 TO 369/PNJ/ 2015, IT A NOS. 370 TO 373/PNJ/2015, ITA NO.374/ PNJ/ 2015 & ITA NO.357/PNJ/2015 (ASST. YR : 2009 - 10), (ASST. YR : 2011 - 12), (ASST. YRS : 2008 - 09, 2009 - 10 & 2011 - 12), (ASST. YRS : 2007 - 08, 2008 - 09 ,2009 - 10 & 2012 - 13), (ASST. YRS : 2007 - 08, 2008 - 09 & 2012 - 13), (ASST. YRS : 2007 - 08, 2008 - 09, 2009 - 10 & 2012 - 13), (ASST. YR :2012 - 13) & (ASST. YR :2010 - 11) PAN : AAATT6235A. (RESPONDENT) A PPELLANT S BY : DR. S. SUNDARESAN , LD. DR. RE SPONDENT S BY : SHRI SHAM J. KAMAT, C.A , SHRI VENKATESH J. SHENAI, C.A, NONE . SHRI SHAM J. KAMAT, C.A, SHRI RAJENDAR BHOBE, C.A, SHRI RAJENDAR BHOBE, C.A, SHRI VENKATESH J. SHENAI, C.A, SHRI JAYANT P. VOLVOIKAR, C.A. D ATE OF HEARING : 20 / 0 1 /201 6 DATE OF ORDER : 20 / 0 1 /201 6 O R D E R PER NARENDRA S. SAINI : THESE ARE THE APPEALS FILED BY THE REVENUE AGAINST THE ORDER OF THE LD. CIT(A), PANAJI - 1, FOR THE ASSESS MENT YEARS STATED ABOVE. 2. THE LD. D. R , DR. S. SUNDARESAN SUBMITTED THAT IN ALL THESE APPEALS, THE FACTS AND ISSUES INVOLVED ARE COMMON HENCE, HE SUBMITTED HE WILL ARGUE THEM TOGETHER. 3. THE FIRST COMMON GROUND OF APPEAL IN ALL THESE APPEALS IS THAT, THE CIT(A) ER RED IN DELETING THE ADDITION ON ACCOUNT OF DISALLOWANCE OF DEDUCTION IN RESPECT OF CO - OPERATIVE SOCIETY U/S 80P(2)(A)(I) ON THE GROUND THAT THE ASSESSEE IS A CO - OPERATIVE SOCIETY ACCEPTING DEPOSITS FROM ITS MEMBERS AND LENDS MONEY ONLY 4 ITA NO . 363/PNJ/2015, ITA NO.366/PNJ/2015, I TA NOS. 358 TO 360/PNJ/2015, ITA NOS.361,362, 364 & 365/PNJ/2015, ITA NOS. 367 TO 369/PNJ/ 2015, IT A NOS. 370 TO 373/PNJ/2015, ITA NO.374/ PNJ/ 2015 & ITA NO.357/PNJ/2015 (ASST. YR : 2009 - 10), (ASST. YR : 2011 - 12), (ASST. YRS : 2008 - 09, 2009 - 10 & 2011 - 12), (ASST. YRS : 2007 - 08, 2008 - 09 ,2009 - 10 & 2012 - 13), (ASST. YRS : 2007 - 08, 2008 - 09 & 2012 - 13), (ASST. YRS : 2007 - 08, 2008 - 09, 2009 - 10 & 2012 - 13), (ASST. YR :2012 - 13) & (ASST. YR :2010 - 11) TO ITS MEMBERS AN D CANNOT ISSUE CHEQUE BOOKS, WHEN ASSESSEE ACCEPTS DEPOSITS AND GRANTS LOANS TO ITS MEMBERS ON WHICH IT MAKES PROFIT AND GAINS BY CARRYING INTEREST, THUS PROVIDING CREDIT FACILITY AKIN TO BANKING BUSINESS AS PER SECTION 2(24)(VIIA) AND PART - V OF THE BANK ING REGULATION ACT, 1949 HENCE THE ASSESSEE IS NOT ELIGIBLE FOR DEDUCTION U/S 80P . 4. THE FACTS OF THE CASE IN ALL THE ABOVE APPEALS IS THAT THE ASSESSEE IS A CO - OPERATIVE SOCIETY REGISTERED UNDER MAHARASHTRA CO - OPERATIVE SOCIETIES ACT, 1960 . THE ASSESSE E S MAIN OBJECT IS TO ACCEPT DEPOSIT AND PROVIDE FINANCIAL ACCOMMODATION TO ITS MEMBERS AND THEREFORE IT WAS CLAIMED THAT IT WAS ENTITLED TO DEDUCTION U/S 80P(2)(A)(I) UNDER CHAPTER ( VIA ) AS IT IS A CO - OPERATIVE SOCIETY CARRYING ON THE BUSINESS O F BANKING OF PROVIDING CREDIT FACILITIES TO ITS MEMBERS. THE ASSESSING OFFICER DISALLOWED THE CLAIM OF THE ASSESSEE FOR DEDUCTION U/S 80P(2)(A)(I) ON THE GROUND THAT AS PER THE PROVISIONS OF SECTION 80P(4) READ WITH SECTION 2(24)(VIIA) W.E.F. 01.04.2007 DEFINITION OF INCOME HAS BEEN ENLARGED TO INC LUDE PROFITS AND GAINS OF ANY B USINESS OF BANKING (INCLUDING PROVIDING CREDIT FACILITIES) CARRIED ON BY A CO - OPERATIVE SOCIETY WITH ITS MEMBERS. 5. ON APPEAL THE CIT(A) ALLOWED THE CLAIM OF THE ASSESSEE BY F OLLOWING THE DECISION OF THE HONBLE HIGH COURT OF BOMBAY AT GOA IN TAX APPEALS NO. 22,23 & 24 OF 2015, ORDER DATED 17.04.2015 WHEREIN IT WAS HELD AS UNDER : - THERE IS NO DISPUTE BETWEEN THE PARTIES THAT THE APPELLANT IS A CO - OPERATIVE SOCIETY AS THE S AME IS REGISTERED UNDER THE CO - OPERATIVE SOCIETIES ACT. THE APPELLANT IS CLAIMING DEDUCTION OF INCOME 5 ITA NO . 363/PNJ/2015, ITA NO.366/PNJ/2015, I TA NOS. 358 TO 360/PNJ/2015, ITA NOS.361,362, 364 & 365/PNJ/2015, ITA NOS. 367 TO 369/PNJ/ 2015, IT A NOS. 370 TO 373/PNJ/2015, ITA NO.374/ PNJ/ 2015 & ITA NO.357/PNJ/2015 (ASST. YR : 2009 - 10), (ASST. YR : 2011 - 12), (ASST. YRS : 2008 - 09, 2009 - 10 & 2011 - 12), (ASST. YRS : 2007 - 08, 2008 - 09 ,2009 - 10 & 2012 - 13), (ASST. YRS : 2007 - 08, 2008 - 09 & 2012 - 13), (ASST. YRS : 2007 - 08, 2008 - 09, 2009 - 10 & 2012 - 13), (ASST. YR :2012 - 13) & (ASST. YR :2010 - 11) EARNED ON PROVIDING CREDIT FACILITIES TO ITS MEMBERS AS PROVIDED UNDER SECTION 80P(2)(A)(I) OF THE ACT. IT IS APPELLANTS CASE THAT, IT IS NOT CARRYING ON THE BUSINESS OF THE BANKING. CONSEQUENTLY, NOT BEING A CO - OPERATIVE BANK THE PROVISIONS OF SECTION 80P(4) OF THE ACT WOULD NOT EXCLUDE THE APPELLANT FROM CLAIMING THE BENEFIT OF DEDUCTION UNDER SECTION 80P(2)( A)(I) OF THE ACT. HOWEVER IN TERMS OF SECTION 80P OF THE ACT THE MEANING OF THE WORDS COOPERATIVE BANK IS THE MEANING ASSIGNED TO IT IN CHAPTER V OF THE BANKING REGULATION ACT, 1949. A COOPERATIVE BANK IS DEFINED IN SECTION 5(CCI) OF BANKING REGULATION ACT TO MEAN A STATE COOPERAT IVE BANK. ADMITTEDLY, THE APPELLANT IS NOT A STATE COOPERATIVE BANK, A CENTRAL COOPERATIVE BANK. THUS WHAT HAS TO BE EXAMINED IS WHETHER THE APPELLANT IS A PRIMARY COOPERATIVE BANK AS DEFINED IN PARA V OF THE BANKING REGULATION ACT. SECTION 5(CCV) OF THE BANKING REGULATION ACT DEFINES A PRIMARY COOPERATIVE BANK TO MEAN A COOPERATIVE SOCIETY WHICH CUMULATIVELY SATISFIES THE FOLLOWING THREE CONDITIONS : 1) ITS PRINCIPAL BUSINESS OR PRIMARY OBJECT SHOULD BE BANKING BUSINESS OF BANKING; 2) ITS PAID UP SHARE CAPITAL AND RESERVES SHOULD NOT BE LESS THAN RUPEES ONE LAKH. 3) ITS BYE - LAWS DO NOT PERMIT ADMISSION OF ANY OTHER COOPERATIVE SOCIETY AS ITS MEMBER. IT IS ACCEPTED POSITION THAT CONDITION NO.(2) IS SATISFIED AS THE SHARE CAPITAL IN AN EXCESS OF RUPEES ONE LAKH. IT HAS BEEN THE APPELLANTS CONTENTION THAT THE CONDITIONS NO. (1) AND (3) PROVIDED ABOVE ARE NOT SATISFIED. THEREFORE THE ISSUE THAT ARISES FOR CONSIDERATION IS WHETHER THE APPELLANT SATISFIES CONDITION NO . (1) AND (3) ABOVE. THE IMPUGNED ORDER AFTER REFERRING TO THE DEFINITION OF BANKING BUSINESS AS DEFINED IN SECTION 5B OF THE BANKING REGULATION ACT, HELD THAT THE PRINCIPAL BUSINESS OF THE APPELLANT IS BANKING. SECTION 5B OF THE BANKING REGULATION ACT DEFINES BANKING TO MEAN ACCEPTING OF DEPOSITS FOR THE PURPOSE OF LENDING OR INVESTMENT, OF 6 ITA NO . 363/PNJ/2015, ITA NO.366/PNJ/2015, I TA NOS. 358 TO 360/PNJ/2015, ITA NOS.361,362, 364 & 365/PNJ/2015, ITA NOS. 367 TO 369/PNJ/ 2015, IT A NOS. 370 TO 373/PNJ/2015, ITA NO.374/ PNJ/ 2015 & ITA NO.357/PNJ/2015 (ASST. YR : 2009 - 10), (ASST. YR : 2011 - 12), (ASST. YRS : 2008 - 09, 2009 - 10 & 2011 - 12), (ASST. YRS : 2007 - 08, 2008 - 09 ,2009 - 10 & 2012 - 13), (ASST. YRS : 2007 - 08, 2008 - 09 & 2012 - 13), (ASST. YRS : 2007 - 08, 2008 - 09, 2009 - 10 & 2012 - 13), (ASST. YR :2012 - 13) & (ASST. YR :2010 - 11) DEPOSIT OF MONEY FROM THE PUBLIC REPAYABLE ON DEMAND OR OTHERWISE. THE IMPUGNED ORDER JUXTAPOSES THE ABOVE DEFINITION WITH THE FINDING OF FACT THAT THE APPELLANT DID DEAL WITH NO N MEMBERS IN A FEW CASES BY SEE K ING DEPOSITS . THIS READ WITH BYE LAW 43 LEADS TO THE CONCLUSION THAT IT IS CARRYING ON BANKING BUSINESS. THIS FACT OF ACCEPTING DEPOSITS FROM PEOPLE WHO ARE NOT MEMBERS HAS BEEN SO RECORDED BY THE CIT(A) IN HIS ORDER DATED 15 JULY, 2014. BEFORE THE TRIBUNAL ALSO THE APPELLANT DID NOT DISPUTE THE FACT THAT IN A FEW CASES T HEY HAVE DEALT WITH NON MEMBERS . HOWEVER SO FAR AS ACCEPTING DEPOSITS FROM NON MEMBERS IS CONCERNED IT IS SUBMITTED THAT THE BYE - LAW 43 ON LY PERMITS THE SOCIETY TO ACCEPT DEPOSITS FROM ITS MEMBERS. IT IS SUBMITTED THAT BYE - LAWS 43 DOES NOT PERMIT RECEIPT OF DEPOSITS FROM PERSONS OTHER THAN MEMBERS, THE WORD ANY PERSON IS A GLOSS ADDED IN THE IMPUGNED ORDER AS IT IS NOT FOUND IN BYE LAW 4 3. IT IS UNDISPUTED THAT THE TRANSACTIONS WITH NON MEMBERS ARE INSIGNIFICANT / MINISCULE. ON THE ABOVE BASIS IT CANNOT BE CONCLUDED THAT THE APPELLANTS PRINCIPAL BUSINESS IS OF ACCEPTING DEPOSITS FROM PUBLIC AND THEREFORE IT IS IN BANKING BUSINESS. IN FAC T, THE IMPUGNED ORDER ERRONEOUSLY RELIED UPON BYE - LAW 43 OF THE SOCIETY WHICH ENABLES THE SOCIETY TO RECEIVE DEPOSITS TO CONCLUDE THAT IT CAN RECEIVE DEPOSITS FORM PUBLIC. HOWEVER, THE IMPUGNED ORDER RELIES UPON BYE - LAW 43 TO CONCLUDE THAT IT ENABLES THE APPELLANT TO RECEIVE DEPOSITS FROM ANY PERSON IS NOT CORRECT. THUS IN THE PRESENT FACTS THE FINDINGS THAT THE APPELLANTS PRINCIPAL BUSINESS IS OF BANKING IS PERVERSE, AS IT IS NOT SUPPORTED BY THE EVIDENCE ON RECORD. SO FAR AS THE ISSUE OF PRIMARY OBJEC T OF THE APPELLANT IS CONCERNED THE IMPUGNED ORDER GIVES NO FINDING ON THAT BASIS TO DEPRIVE THE APPELLANT THE BENEFIT OF SECTION 80P OF THE ACT. THE IMPUGNED ORDER SETS OUT THE OBJECT CLAUSE OF THE APPELLANT, WHICH HAS 24 OBJECTS BUT THEREAFTER DRAWS NO S EQUITER TO CONCLUDE THAT THE PRIMARY OBJECT IS BANKING. CONSEQUENTLY THERE IS NO OCCASION TO DEAL WITH THE SAME AS THAT IS NOT THE BASIS ON WHICH THE IMPUGNED ORDER HOLDS THAT IT IS A PRIMARY COOPERATIVE BANK. 7 ITA NO . 363/PNJ/2015, ITA NO.366/PNJ/2015, I TA NOS. 358 TO 360/PNJ/2015, ITA NOS.361,362, 364 & 365/PNJ/2015, ITA NOS. 367 TO 369/PNJ/ 2015, IT A NOS. 370 TO 373/PNJ/2015, ITA NO.374/ PNJ/ 2015 & ITA NO.357/PNJ/2015 (ASST. YR : 2009 - 10), (ASST. YR : 2011 - 12), (ASST. YRS : 2008 - 09, 2009 - 10 & 2011 - 12), (ASST. YRS : 2007 - 08, 2008 - 09 ,2009 - 10 & 2012 - 13), (ASST. YRS : 2007 - 08, 2008 - 09 & 2012 - 13), (ASST. YRS : 2007 - 08, 2008 - 09, 2009 - 10 & 2012 - 13), (ASST. YR :2012 - 13) & (ASST. YR :2010 - 11) IN THE ABOVE VIEW, THE ALTERNATIVE CONTENTIO N OF THE APPELLANT THAT IT IS NOT IN THE BUSINESS OF BANKING AS THE SINE QUO NON TO CARRY ON BANKING BUSINESS IS A LICENCE TO BE ISSUED BY THE RESERVE BANK OF INDIA, WHICH IT ADMITTEDLY DOES NOT HAVE, IS NOT BEING CONSIDERED. SO FAR AS CONDITION NO.3 OF THE DEFINITION / MEANING OF PRIMARY COOPERATIVE BANK AS PROVIDED IN SECTION 5(CCV) OF THE BANKING REGULATION ACT IS CONCERNED, THE SAME REQUIRES THE BYE LAWS OF SOCIETY CONTAIN A PROHIBITION FROM ADMITTING ANY OTHER COOPERATIVE SOCIETY AS ITS MEMBER. IN FACT THE BYE - LAWS OF THE APPELLANT SOCIETY ORIGINALLY IN BYE - LAW 9(B) CLEARLY PROVIDED THAT NO CO - OPERATIVE SOCIETY SHALL BE ADMITTED TO THE MEMBERSHIP OF THE SOCIETY. THUS THERE WAS A BAR BUT THE SAME WAS AMENDED W.E.F. 12 JANUARY, 2001 AS TO PERMIT A SOC IETY TO BE ADMITTED TO THE MEMBERSHIP TO THE SOCIETY. THEREFORE FOR THE SUBJECT ASSESSMENT YEARS THERE IS NO PROHIBITION TO ADMITTING A SOCIETY TO ITS MEMBERSHIP AND ONE OF THREE CUMULATIVE CONDITIONS PRECEDENT TO BE A PRIMARY COOPERATIVE BANK IS NOT SATI SFIED. HOWEVER THE IMPUGNED ORDER CONSTRUED THE AMENDED CLAUSE 9(D) OF THE APPELLANTS BYE LAWS TO MEAN THAT IT ONLY PERMITS A SOCIETY TO B E ADMITTED TO THE MEMBERSHIP OF THE APPELLANT AND NOT A CO - OPERATIVE SOCIETY. ACCORDING TO THE IMPUGNED ORDER, A SOCIETY AND A CO - OPERATIVE SOCIETY ARE CLEARLY WORDS OF DIFFERENT AND DISTINCT SIGNIFICANCE AND THE MEMBERSHIP IS ONLY OPEN TO SOCIETY AND NOT TO A CO - OPERATIVE SOCIETY. AS RIGHTLY POINTED OUT ON BEHALF OF THE APPELLANT THE WORD SOCIETY AS REFERRED TO BYE LAW 9(D) WOULD INCLUDE THE CO - OPERATIVE SOCIETY. THIS IS SO AS THE DEFINITION OF A SOCIETY UNDER THE CO - OPERATIVE ACT IS A CO - OPERATIVE REGIST ERED UNDER THE CO - OPERATIVE ACT. BESIDES THE QUALIFYING CONDITION 4 FOR BEING CONSIDERED AS A PRIMARY CO - OPERATIVE BANK IS THAT THE BYE LAWS MUST NOT PERMIT ADMISSION OF ANY OTHER COOPERATIVE SOCIETY. THIS IS A MANDATORY CONDITION I.E THE BYE LAWS MUST S PECIF ICALLY PROHIBIT ADMISSION OF ANY OTHER COOPERATIVE SOCIETY TO ITS MEMBERSHIP. THE REVENUE HAS NOT BEEN ABLE TO SHOW ANY SUCH PROHIBITION IN THE BYE LAWS OF THE APPELLANT. THUS EVEN THE 8 ITA NO . 363/PNJ/2015, ITA NO.366/PNJ/2015, I TA NOS. 358 TO 360/PNJ/2015, ITA NOS.361,362, 364 & 365/PNJ/2015, ITA NOS. 367 TO 369/PNJ/ 2015, IT A NOS. 370 TO 373/PNJ/2015, ITA NO.374/ PNJ/ 2015 & ITA NO.357/PNJ/2015 (ASST. YR : 2009 - 10), (ASST. YR : 2011 - 12), (ASST. YRS : 2008 - 09, 2009 - 10 & 2011 - 12), (ASST. YRS : 2007 - 08, 2008 - 09 ,2009 - 10 & 2012 - 13), (ASST. YRS : 2007 - 08, 2008 - 09 & 2012 - 13), (ASST. YRS : 2007 - 08, 2008 - 09, 2009 - 10 & 2012 - 13), (ASST. YR :2012 - 13) & (ASST. YR :2010 - 11) AFORESAID QUALIFYING CONDITION (3) FOR BEING CONSIDERED AS A P RIMARY COOPERATIVE BANK IS NOT SATISFIED. THUS, THE THREE CONDITIONS AS PROVIDED UNDER SECTION 5(CVV) OF THE BANKING REGULATION ACT, 1949, ARE TO BE SATISFIED CUMULATIVELY AN EXCEPT CONDITION (2) THE OTHER TWO QUALIFYING CONDITIONS ARE NOT SATISFIED. EGR O, APPELLANT CANNOT BE CONSIDERED TO BE CO - OPERATIVE BANK FOR THE PURPOSES OF SECTION 80P(4) OF THE ACT. THUS, THE APPELLANT IS ENTITLED TO THE BENEFIT OF DEDUCTION AVAILABLE UNDER SECTION 80P(2)(A)(I) OF THE ACT. THE CONTENTION OF MS. DESSAI, LEARNED COUNSEL FOR THE REVENUE THAT THE APPELLANT IS NOT ENTITLED TO THE BENEFIT OF SECTION 80P(2)(A)(I) OF THE ACT IN VIEW OF THE FACT THAT IT DEALS WITH NON - MEMBERS CANNOT BE UPHELD. THIS FOR THE REASON THAT SECTION 80P(1) OF THE ACT RESTRICTS THE BENEFITS OF DEDUCTION OF INCOME OF CO - OPERATIVE SOCIETY TO THE EXTENT IT IS EARNED BY PROVIDING CREDIT FACILITIES TO ITS MEMBERS. THEREFORE, TO THE EXTENT THE INCOME EARNED IS ATTRIBUTABLE TO DEALINGS WITH THE NON - MEMBERS ARE CONCERNED THE BENEFIT OF SE CTION 80P OF T HE ACT WOULD NOT BE AVAILABLE . IN THE ABOVE VIEW OF THE MATTER, AT THE TIME WHEN EFFECT HAS BEEN GIVEN TO THE ORDER OF THIS COURT, THE AUTHORITIES UNDER ACT WOULD RESTRICT THE BENEFIT OF DEDUCTION UNDER SECTION 80P OF THE ACT ONLY TO THE EXTENT THAT THE S AME IS EARNED BY THE APPELLANT IN CARRYING ON ITS BUSINESS OF PROVIDING CREDIT FACILITIES TO ITS MEMBERS. ACCORDINGLY, THE SUBSTANTIAL QUESTION OF LAW AS FRAMED IS ANSWERED IN THE NEGATIVE I.E. IN FAVOUR OF THE APPELLANT AND AGAINST THE RESPONDENT - REVENUE. IN VIEW OF THE DECISION OF THE HON'BLE HIGH COURT, THE AO IS DIRECTED TO ALLOW THE DEDUCTION U/S. 80P TO THE APPELLANT. THE APPEAL IS ALLOWED. 6. THE LD. DR COULD NOT POINT OUT ANY SPECIFIC MISTAKE IN THE ORDER OF THE CIT(A). HE COULD NOT POINT OUT ANY DISTINGUISHING FEATURE IN THE PRESENT APPEALS BEFORE US. 9 ITA NO . 363/PNJ/2015, ITA NO.366/PNJ/2015, I TA NOS. 358 TO 360/PNJ/2015, ITA NOS.361,362, 364 & 365/PNJ/2015, ITA NOS. 367 TO 369/PNJ/ 2015, IT A NOS. 370 TO 373/PNJ/2015, ITA NO.374/ PNJ/ 2015 & ITA NO.357/PNJ/2015 (ASST. YR : 2009 - 10), (ASST. YR : 2011 - 12), (ASST. YRS : 2008 - 09, 2009 - 10 & 2011 - 12), (ASST. YRS : 2007 - 08, 2008 - 09 ,2009 - 10 & 2012 - 13), (ASST. YRS : 2007 - 08, 2008 - 09 & 2012 - 13), (ASST. YRS : 2007 - 08, 2008 - 09, 2009 - 10 & 2012 - 13), (ASST. YR :2012 - 13) & (ASST. YR :2010 - 11) 7. WE FIND THAT THE CIT(A) HAS ALLOWED DEDUCTION U/S 80P TO THE ASSESSEE BY FOLLOWING THE DECISION OF THE JURISDICTIONAL HIGH COURT. THEREFORE W E FIND NO MERIT IN THIS GROUND OF APPEAL OF THE REVENUE AND HENCE THEY ARE DISMISSED. 8. IN GROUND NO.2, OF THE APPEAL THE GRIEVANCE OF THE REVENUE IS THAT THE CIT(A) ERRED IN HOLDING THAT ASSESSEE CO - OPERATIVE SOCIETY CANNOT BE EQUATED WITH BANKING W ITH BANK AS SUCH PROVISIONS OF SECTION 40(A)(IA) ARE NOT ATTRACTED IN THE ASSESSEES CASE, WHEN THE ASSESSEE BEING A CO - OPERATIVE SOCIETY ENGAGED IN CARRYING ON THE BUSINESS OF BANKING IS LIABLE TO MAKE TDS U/S 194A . H ENCE EXPENDITURE CLAIMED BY THE ASS ESSEE TOWARDS INTEREST PAYMENT EXC EE DING RS.10,000/ - O N TERM DEPOSITS ON WHICH TDS HAS NOT BEEN MADE IS DIS ALLOW ABLE U/S 40(A)(IA) OF THE ACT. 9. THE FACTS OF THE CASE ARE THAT THE ASSESSING OFFICER DISALLOWED DEDUCTION FOR INTEREST EXPENDITURE CLAIM ED BY THE ASSESSEE BY INVO K ING THE PROVISIONS OF SECTION 40(A)(IA) FOR NON - DEDUCTION OF TDS THERE ON. ON APPEAL THE CIT(A) ALLOWED THE DEDUCTION OBSERVING AS HE HAS DECIDED THAT THE ASSESSE E CO - OPERATIVE SOCIETY IS NOT A BANK AND THEREFORE TDS PROVISIONS ARE NOT APPLICABLE OF THE ASSESSEE. 10. SINCE WE HAVE CONFIRMED THE FINDINGS OF THE CIT(A) THAT THE ASSESSEE IS A CO - OPERATIVE SOCIETY AND NOT A BANK AND THEREFORE TDS PROVISIONS ARE NOT 10 ITA NO . 363/PNJ/2015, ITA NO.366/PNJ/2015, I TA NOS. 358 TO 360/PNJ/2015, ITA NOS.361,362, 364 & 365/PNJ/2015, ITA NOS. 367 TO 369/PNJ/ 2015, IT A NOS. 370 TO 373/PNJ/2015, ITA NO.374/ PNJ/ 2015 & ITA NO.357/PNJ/2015 (ASST. YR : 2009 - 10), (ASST. YR : 2011 - 12), (ASST. YRS : 2008 - 09, 2009 - 10 & 2011 - 12), (ASST. YRS : 2007 - 08, 2008 - 09 ,2009 - 10 & 2012 - 13), (ASST. YRS : 2007 - 08, 2008 - 09 & 2012 - 13), (ASST. YRS : 2007 - 08, 2008 - 09, 2009 - 10 & 2012 - 13), (ASST. YR :2012 - 13) & (ASST. YR :2010 - 11) APPLICABLE TO THE ASSESSEE. HENCE, WE CONFIRM THE ORDER OF THE CIT( A) AND DISMISS THIS GROUND OF APPEAL OF REVENUE ALSO. 11. IN THE RESULT, THE APPEALS OF THE REVENUE ARE DISMISSED . 12 . ORDER PR ONOUNCED IN THE COURT AT THE CLOSE OF THE HEARING IN THE PRESENCE ON THE PARTIES ON WEDNESDAY THE 20 TH DAY OF JANUARY, 201 6 AT GOA . SD/ - ( GEORGE MATHAN ) JUDI CIAL ME MBER SD/ - ( NARENDRA S. SAINI ) AACCOUNTANT M EMBER P LACE : PANAJI - GOA DATED : 20 / 0 1 /201 6 *A* COPY TO : (1) APPELLANT S (2) RESPONDENT S (3) CIT CONCERNED (4) CIT(A) CONCERNED (5) D.R (6) GUARD FILE TRUE COPY, BY ORDER ASSISTANT REGISTRAR ITAT, PANAJI BENCH, PANAJI