Special Story – The Maharashtra Co-op. Housing Society In order to widen the tax base vis-a-vis profit –linked deductions, the Finance Act, 2012 has amended section 115JC effective from assessment year 2013-14 to provide that a person other than a company, who has claimed deduction under any section (other than section 80P) included in Chapter VI-A under the heading “C. – Deductions in respect of certain incomes� or under section 10AA, shall be liable to pay Alternate Minimum Tax (AMT). Section 115JEE provides that the provisions of Chapter XII-BA shall apply to a person who has claimed any deductions under – (a)
any section (other than section 80P) included in Chapter VI-A under the heading “C. – Deductions in respect of 5 section 10AA.
Thus, it can be said that in case of a co-operative society which claims deduction under section 80P, AMT will not be applicable. 28.1 The taxation of co-operative society is often misunderstood and it is common knowledge that many co-operative societies are oblivious to TDS provisions. 28.2 Like others, co-operative society is also liable to deduct tax. If the society has to deduct income tax it must obtain TAN number and file return of TDS. Some of the important points to be noted in this regard are A. On Interest Payment Section 193 of I. T. Act lays down law of TDS on payment of any income by way of interest on securities exempts a co-operative u/s 193(iib). Section 194A which is law for TDS on interest other than “Interest on securities� exempts from TDS if the interest payment by a co-operative society is less than 10,000. Section 194A also exempts any person from liability of deducting tax at source if the payee
SS-VI-89
As per section 194(v), co-operative society is also exempted from liability to deduct tax at source on payment of interest to its members or any other co-operative society. B. On salary A co-operative society is liable to deduct tax 192 TDS on salary to its employees if any. C. On Contractual payments u/s 194C Explanation to section 194C clearly includes a ‡ $ ‰ is liable for deducting tax at source u/s 194C. D. All other TD provisions Likewise, all other TDS provision equally applies to a co-operative society.
Or (b)
is a co-operative society engaged in carrying on the business of banking including a co-operative land mortgage.
Whether the payments made to co-operative society should suffer TDS? Since the exemption is given only in case of interest payments, as stated above, the payments which falls under sections 194C, 194H, 194I or other TDS provision, no such exemption from TDS is available to a co-operative society and TDS must be made on payments covered under those sections if all other conditions are also The provisions requiring deduction of tax at source (TDS) like those of Section 194C while paying to a contractor for works etc. are equally applicable to co-operative societies. Illustrative list of TDS requirement is presented below: a)
Salary to employees (sec.192) - Rate of deduction as applicable to individual
b)
Payment to contractors/sub-contractors (Sec. 194C For example : Building repairing/painting contracts, security charges, maintenance contracts for lifts,
The Chamber's Journal April 2013
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