ORDER :

D.N. Patel, J.

1. This Tax Appeal has been preferred by the assessee being aggrieved and feeling dissatisfied by the order passed by Income Tax Appellate Tribunal, Ranchi Circuit Bench, Ranchi in ITA No.137/Ran/2010 for the assessment year 2004-05. The date of order is 5th December, 2014, when the appeal preferred by this appellant was dismissed and hence, the assessee has preferred the present Tax Appeal.

2. This Tax Appeal has been preferred mainly on the ground that this assessee is a Cooperative Society and is exempted from the payment of income tax upon the transfer fee received from the members.

3. This assessee is engaged in construction of dwelling units, which are being sold to several persons, who are becoming members of this assessee. Sizable transfer fee has been received and the deductions have been claimed, which are not allowed by the Assessing Officer.

4. It is contended by the counsel for the appellant that the interest receipt is covered under Section 80P(2)(a)(i) of the Income-tax Act and, hence, the interest receipt cannot be added to the income of this assessee. Thus, the addition of interest income made by the Assessing Officer at Rs.2,15,447/-and receipt towards transfer fee at Rs.15,42,250/-, for the assessment year 2004-05 are de hors the provision of Income-tax Act. These aspects of the matter have not been properly appreciated by the learned Commissioner of Income Tax (Appeals)as well as Income Tax Appellate Tribunal and hence, the orders passed by the Assessing Officer; the Commissioner of Income Tax (Appeals) as well as the Income Tax Appellate Tribunal deserve to be quashed and set aside.

5. Counsel for the respondents submitted that this appellant-assessee has been engaged in construction of dwelling units and selling it to the public at large and is getting the sale price along with the transfer fees. In fact, the main business of this assessee is not to give the loans or the credit to its members. In fact, not a single member of the appellant-Society is fixed one or identified one. Those who are coming to purchase the dwelling units or the flats or the residential units, they have to become members of this appellant. Thus, the provision of Section 80P(2)(a)(i) of the Income-tax Act is not applicable to this appellant looking to the facts of the present case.

6. It is further submitted by the counsel for the respondents that no error has been committed by the Assessing Officer in rejecting the claim of deduction of transfer fee amounting to Rs.15,42,250/-. The appellant-assessee is not a club, nor it is a Cooperative Society having fixed or definite members, who have been contributing towards this assessee-society. In fact, the purchasers of the flats have to become members. Thus, the transfer fee is a part & parcel of the sale price of the flats. Similarly, interest receipt is also to be added in the income of this assessee, because, it is not covered by Section 80P(2)(a)(i) of the Income-tax Act. This assessee is not engaged in business of even credit facility to its members. This assessee is selling the flats to the public at large and those who are purchasing the flats, have to become member of this appellant. Thus, the interest receipt by such type of assesses are not covered by Section 80P(2)(a)(i) of the Income-tax Act. Hence, no error has been committed by the Assessing Officer in determining the total income at Rs.31,32,500/-. These aspects of the matter have been properly appreciated by the Commissioner of Income Tax (Appeals) as well as the Income Tax Appellate Tribunal and, hence, this appeal may not be entertained by this Court.

7. Reasons:

Having heard counsels for both sides and looking to the facts and circumstances of the case, we see no reason to entertain this Tax Appeal, as no substantial question of law is involved, mainly for the following facts and reasons: -

(i) This appellant is claiming to be a Cooperative Society and, hence, claiming exemption under Section 80P(2)(a)(i)