80p

NO Rs. 50000/- deduction specified in sec. 80P(2)(c) is deduction from profits of business and not from rental income.

In my opinion deduction should be allowed as 80p provides for other incomes, there is a general deductions from income as under from gross total income. 1) In case of consumer co-operative society Rs100000. 2) in any other case Rs50000. My view is based on the following points. 1) sec. 80 provides deductions from total income. 2) for other income its not provide the source of income(heads of income). Please confirm from others views.

 

Please see the underlined portions of section 80 P. Deduction for rental activity is specifically provided in 80P(2)(e) (and Mobile tower rental is not covered!!). 80P is a combo section which deals with deductions for many kinds of incomes of different kinds of coop societies. It has been a general trend to claim the omnibus 50000/- for all societies even for societies which are defunct and have no activity. But many cases have been decided agaisnt such deductions by societies without activity.

80P (1) Where, in the case of an assessee being a co-operative society, the gross total income includes any income referred to in sub-section (2), there shall be deducted, in accordance with and subject to the provisions of this section, the sums specified in sub-section (2), in computing the total income of the assessee.

(2) The sums referred to in sub-section (1) shall be the following, namely :—

(a)  in the case of a co-operative society engaged in—

 (i)  carrying on the business of banking or providing credit facilities to its members, or

(ii)  a cottage industry, or

(iii)  the marketing of agricultural produce grown by its members, or

(iv)  the purchase of agricultural implements, seeds, livestock or other articles intended for agriculture for the purpose of supplying them to its members, or

(v)  the processing, without the aid of power, of the agricultural produce of its members, or

(vi)  the collective disposal of the labour of its members, or

(vii) fishing or allied activities, that is to say, the catching, curing, processing, preserving, storing or marketing of fish or the purchase of materials and equipment in connection therewith for the purpose of supplying them to its members,

the whole of the amount of profits and gains of business attributable to any one or more of such activities :

Provided that in the case of a co-operative society falling under sub-clause (vi), or sub-clause (vii), the rules and bye-laws of the society restrict the voting rights to the following classes of its members, namely:—

(1)  the individuals who contribute their labour or, as the case may be, carry on the fishing or allied activities;

(2)  the co-operative credit societies which provide financial assistance to the society;

(3)  the State Government;

(b)  in the case of a co-operative society, being a primary society engaged in supplying milk, oilseeds, fruits or vegetables raised or grown by its members to—

 (i)  a federal co-operative society, being a society engaged in the business of supplying milk, oilseeds, fruits, or vegetables, as the case may be; or

(ii)  the Government or a local authority; or

(iii)  a Government company as defined in section 617 of the Companies Act, 1956 (1 of 1956), or a corporation established by or under a Central, State or Provincial Act (being a company or corporation engaged in supplying milk, oilseeds, fruits or vegetables, as the case may be, to the public),

the whole of the amount of profits and gains of such business;

(c)  in the case of a co-operative society engaged in activities other than those specified in clause (a) or clause (b) (either independently of, or in addition to, all or any of the activities so specified), so much of its profits and gains attributable to such activities as does not exceed,—

 (i)  where such co-operative society is a consumers' co-operative society, one hundred thousand rupees; and

 (ii)  in any other case, fifty thousand rupees.