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The A.O. shall list out the instances where loans have disbursed to non-members of assessee-society, for non-agricultural purposes etc. and accordingly conclude that the assessee’s activities are not in compliance with the activities of primary agricultural credit society functioning under the Kerala Co-operative Societies Act, 1969, before denying the claim of deduction u/s 80P(2) of the I.T.Act.

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Sec. 80P(2)(a)(i) of Income Tax Act, 1961— Deduction —There should be fresh examination by the Assessing Officer as regards the nature of each loan disbursement and purpose for which it has been disbursed, i.e., whether it for agricultural purpose or not and A.O. shall list out the instances where loans have disbursed to non-members of assessee-society, for non-agricultural purposes etc. and accordingly conclude that the assessee’s activities are not in compliance with the activities of primary agricultural credit society functioning under the Kerala Co-operative Societies Act, 1969, before denying the claim of deduction u/s 80P(2), thus, the issue raised in this appeal is restored to the files of the Assessing Officer - PERUVEMBA SERVICE CO-OPERATIVE BANK LIMITED V/s ITO - [2020] 26 ITCD Online 123 (ITAT-COCHIN)