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03-07-2019, AA 226 Modakurichi Primary, Section 80P(4), HIGH COURT OF MADRAS
Mr.C.Prakasam, learned counsel on record for writ petitioner and Mr.A.N.R.Jayapratap, learned junior standing counsel for respondents are before this Court.
2.It is submitted without any disputation or disagreement that this matter is covered by an earlier order made by this Court being order dated 27.06.2019 in W.P.No.2552 of 2019 etc., batch. For the sake of convenience, clarity and ease of reference, the entire order dated 27.06.2019 made in the batch is extracted and reproduced infra:
'This common order will dispose of all these 33 writ petitions. There is no disputation or disagreement before this Court and between the parties that all these 33 writ petitions are covered by an earlier order dated 18.06.2019 made by this Court in W.P.Nos.16868, 16877, 16882 and 16893 of 2019, which in turn was made by following an earlier common order dated 11.06.2019 made by this Court in W.P.Nos.15651/2019 etc., (five writ petitions).
2. To be noted, all these writ petitions turn on Section 80P of 'Income Tax Act, 1961' ('IT Act' for brevity).
3. For the sake of convenience, clarity and ease of reference, most relevant paragraphs in the aforesaid earlier order dated 11.06.2019 in W.P.Nos.15651 of 2019 etc., (five writ petitions) are extracted and reproduced infra. Most relevant paragraphs in the said order are paragraphs Nos.6 to 19 which read as follows:
'6. Short facts imperative for disposal of these five writ petitions by this common order are as follows:
a) Writ petitioners in each of the five writ petitions are Cooperative Societies.
b) Writ petitioners claim that they are entitled to the benefit ofSection 80P of the 'Income Tax Act, 1961'
c) Respondent has issued notices under Section 148 of IT Act.
d) These notices under Section 148 of IT Act issued to each of the writ petitioners have been assailed in each writ petitions and these notices shall be referred to as 'impugned notice' in singular and 'impugned notices' in plural.
e) Impugned notices have been issued on the basis that there has been income that has escaped assessment within the meaning of Section 147 of IT Act for various previous Assessment years as set out in the respective notices.
f) Predicated on Section 147, the impugned notices which are under Section 148, call upon the writ petitioner assessees to file returns for the Assessment yea s mentioned therein.
g) Contending that a Hon'ble Division Bench of this Court, has held that Cooperative Societies akin to the writ petitioners are entitled to the benefit of Section 80P, instant writ petitions have been filed, assailing the impugned notices.
7. The sheetanchor submission of learned counsel for writ petitioner in each of these five writ petitions is that a Division Bench of this Hon'ble Court, in an order dated 02.08.2016 made in Tax Case Appeal Numbers.484 to 487 and 490 of 2016, has held that Cooperative Societies akin to those of writ petitioners are entitled to the benefit of Section 80P of IT Act.
8. Adverting to the aforesaid order of Hon'ble Division Bench, learned counsel submitted that questions of law, which were entertained by the Hon'ble Division Bench are adumbrated in paragraph 5 of the said order, which reads as follows:
'5. Aggrieved by the order of the Income Tax Appellate Tribunal, the appellants have filing these appeals, on raising the following substantial questions of law:-
1. Whether on the facts and in the circumstances of the case the Tribunal was right in holding that the assessee is to be treated as primary agricultural society and is carrying on the business of banking or providing credit facilities to its members and is entitled for deduction under Section 80P (2) (a) (i) of the Income Tax Act, 1961 with respect to the interest received from Class B members who were involved in non-agricultural activity.
2. Whether on the facts and in the circumstances of the case the Tribunal was right in holding that the Class B members of the assessee society can be treated as a member of the society for the purpose of Section 80P (2) (a) (i) when Class B members do not have the right to participate in the v ting and meetings of the board of the society.
3. Whether on the facts and in the circumstances of the case the Tribunal was right in not considering the fact that the assessee was lending monies for non-agricultural purpose and the provisions of Section 80P (4) and 2(24) (viia).
The contention of the learned counsel for the appellant/ Revenue department, is that Class B members of the respondent societies cannot be treated as members of the assessee societies, as Class B members were not recognised as per record and bye-laws of the assessee society, for the purpose of voting, attending the board meeting etc. Therefore, as per Section 80P (4), the benefit under