THE KERALA STATE COOPERATIVE, MARKETING FEDERATION LIMITED. vs COMMISSIONER OF INCOME TAX

The Supreme Court addressed the eligibility of co-operative societies for deductions under Section 80P(2)(a)(iii) of the Income Tax Act, 1961, concerning purchases from member societies. The Court held that while the Income Tax Officer initially rejected the claim, the Commissioner of Income Tax (Appeals) and the Appellate Tribunal later ruled in favor of the assessee. However, the Court ultimately concluded that deductions are not permissible for purchases made from member societies, aligning with the precedent set in Assam Co-operative Apex Marketing Society Ltd. vs. Commissioner of Income Tax (Addl.) 201 I.T.R. 338, thus ruling against the assessee and in favor of the revenue.