Name doesn’t decide 80P: ITAT allows deduction based on actual activities

Sagara Town House Building Cooperative Society Ltd. Vs ITO (ITAT Bangalore) The ITAT Bangalore held that eligibility for deduction under section 80P cannot be denied merely based on the name or selective reading of objects of a co-operative society; the actual activities and full scope of byelaws must be examined. In this case, the AO denied deduction under section 80P(2)(a)(i) on the ground that the society’s primary object was land-related activities, and not providing credit facilities. The CIT(A) upheld this view. However, the Tribunal noted that the byelaws (specifically clause permitti...