We may without prejudice also examine the assessee’s claim of being a primary co- operative agricultural and rural development bank. The Revenue has rejected the assessee’s claim on the ground that it does not meet the definition thereof inasmuch as its area of operation is not confined to a Taluk (Explanation (b) of section 80P (4)). In this regard, we firstly observe that the assessee has not clarified if it is a member of the Rajasthan State Co-operative Land Development Bank and, if so, since when. Secondly, it has not shown that its principal object is to provide long term credit for agricultural and rural development activities, which constitutes the defining attribute of such a bank, with its object clause nowhere indicating so.
Thirdly, its area of operation admittedly extends beyond one Taluk. The reliance placed on the decision in the case of CIT & Anrs vs. D. Ananda Basappa (supra), based on section 54(1), invoking the provision as enshrined in section 13 of the General Clauses Act, 1897, is clearly misconceived, and rightly rejected by the Revenue. It does not take much strain, and a bare reading of said section would convince one that the investment that qualifies for exemption u/s. 54(1) is that in a residential house, i.e., specifies the nature of investment exempting the income. Clearly, if the investment is in more than one residential house, every part of the investment would satisfy the condition of being in a residential house, and where within the defined time period as provided under the section would qualify for exemption. The provision under reference in the instant case, i.e., Explanation (b) to section 80P(4), on the other hand, is a defining provision employing the word `means’. The same has to be strictly construed, as is well settled, besides having been explained lately by the hon’ble apex court in the case of West Bengal State Warehousing Corporation vs. Indrapuri Studio Pvt Ltd. (in Civil Appeal No. 3865 of 2006 dated 19-10-2010), wherein it held that the word `means’ in a definition signifies a hard and fast definition. Also, it is trite that an exemption provision is to be strictly construed. That apart, a bare reading of the provision makes it abundantly clear that the word `a taluk’ are with reference to the area of operation and not the nature of the area of operation, as contended by and on the assessee’s behalf. We, therefore, find no basis to consider the assessee as being a primary cooperative agricultural and rural development bank as defined in section 80P, so as to be entitled for tax benefit thereunder on its income as one such.
IN THE INCOME TAX APPELLATE TRIBUNAL
JAIPUR BENCHES ‘B’, JAIPUR
BEFORE S/SHRI R.K. GUPTA, JM and SANJAY ARORA, AM I.T.A No. 764/JP/2011
Assessment Year: 2007-08
Kekri Sahakari Bhumi Vikas Bank Ltd., Vs The ITO, Ward – 2,
Opp. Court, Post. Kekri, Beawar Distt. Ajmer
[PAN: AAATK 3393A]
(Assessee -Appellant) (Revenue-Respondent)
Assessee by Shri Sanjeev Jain, CA-AR
Revenue by Shri Vinod Johri, Senior DR
Date of hearing 29/02/2012
Date of pronouncement 23/03/2012
ORDER
