Lok Sabha Question No. 1301 (UNSTARRED), answered on 2023-12-11
Subject: Benefits to Cooperative Societies under Income Tax Act
Ministry: FINANCE
Asked by: Ravindra Kushawaha

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE

## LOK SABHA

## UNSTARRED QUESTION NO. 1301

## ANSWERED ON 11 th  DECEMBER, 2023

## 'BENEFITS TO COOPERATIVE SOCIETIES UNDER INCOME TAX ACT'

## 1301.  Shri Ravinder Kushwaha:

'Will the Minister of Finance be pleased to state: -

- (a) the steps taken by the Government during last three years to provide benefits to the Cooperative Societies under the Income Tax Act;
- (b) whether the Government has issued any clarification on Section 269ST of the Income Tax Act; and
- (c) if so, the details thereof?'

## ANSWER

## MINISTER OF STATE IN THE MINISTER OF FINANCE (SHRI PANKAJ CHOUDHARY)

## Answer (a)

-  Finance  Act,  2020 carried  out  the  following  amendments  in  the  Income-tax  Act,  1961  (the  Act)  to provide benefits to the Cooperative Societies-
- (i)    Section 115BAD had been inserted in the Act to provide benefit of a lower tax rate of 22 percent in case of resident co-operative society from AY 2021-22.
- (ii)    Section  115JC  of  the  Act  had  been  amended  so  as  to  provide  that  the  provisions  relating  to Alternate Minimum Tax (AMT) shall not apply to such co-operative society who have exercised the option referred to in section 115BAD of the Act from AY 2021-22.
- (iii)  Section 115JD of the Act had been amended so as to provide that the provisions relating to carry forward and set off of AMT credit, if any, shall not apply to such co-operative society who have exercised the option referred to in section 115BAD of the Act from AY 2021-22.
-  Finance  Act,  2022  carried  out  the  following  amendments  in  the  Act  to  provide  benefits  to  the Cooperative Societies-
- (i)   Section 115JC of the Act amended so as to provide for the alternate minimum tax (AMT) payable by co-operative societies at a lower rate of 15 percent.
-  Finance  Act,  2023  carried  out  the  following  amendments  in  the  Act  to  provide  benefits  to  the Cooperative Societies -
- (i) Section 115BAE had been inserted in the Act to provide benefit of a lower tax rate of 15 per cent of new co-operatives that commence manufacturing activities till 31.03.2024.
- (ii) Section 155 had been amended to provide an opportunity to sugar co-operatives to claim payments made  to sugarcane farmers for the period to assessment year 2016-17 as expenditure. Consequential amendment had been made to section 154 of the Act.
- (iii) Section 269SS had been amended to provide a higher limit of Rs. 2 lakh per member for cash deposits or repayment of loans in cash to Primary Agriculture Co-operative Societies (PACS) and Primary Co-operative Agriculture and Rural Development Banks (PCARDBs).
- (iv) Section  269T  had  been  amended  to  provide  a  higher  limit  of  Rs.  2  lakh  per  member  for  cash deposits or repayment of loans in cash by Primary Agriculture Co-operative Societies (PACS) and Primary Co-operative Agriculture and Rural Development Banks (PCARDBs)
- (v) Section 194N had been amended to provide for TDS at the rate of 2% on cash withdrawal shall apply on cash withdrawal in excess of Rs. 3 crore, in case of co-operative societies.

## Answer (b)

Yes, CBDT issued one notification and two clarification circulars on Section 269ST of the Act.

## Answer (c)

The notification and two circulars issued on Section 269ST of the Act are as follows: -

|   S. No. | Notification/Clarification/Circular number   | Issued by               |
|----------|----------------------------------------------|-------------------------|
|        1 | Notification No. 57/2017 dated 03.07.2017    | TPL Division of CBDT    |
|        2 | Circular No. 22 of 2017 dated 03.07.2017     | TPL Division of CBDT    |
|        3 | Circular No. 25/2022 dated 30.12.2022        | ITA-II Division of CBDT |

******