15 January 2013
As per sec.80(P)(2)(a)all income from Banking and credit facilities provided to members are fully exempted from Income tax. This benefit is not available for co-operative banks i.e. urban banks,District co-operative banks and State co-operative banks.[section 80(P)(4)]. Income from other activities are exempted upto Rs.50000/-. Recent court verdicts and orders of ITATs have made it clear that the Income tax authorities should not deny these benefit to these societies by classifying them as co-operative banks.
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