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alok arunkumar bhagat (PRACTICING LAWYER)     24 October 2008

section 80P of IT Act

Hello,


Please guide me whether profit earned on constrction activity by a co-operative housing society ( construction for allotment and finance of loan to the members of the society) will be taxable or not to the society ? deduction u/s 80P is alowed for such profit.? 


 Alok Bhagat


Advocate


Nagpur



Learning

 2 Replies

Isaac Gabriel (Advocate)     25 October 2008

The entire business of coop.housing society is subjected to audit,and there is no separate profit and loss account for construction activities alone.Income tax is assessed on the basis of the total profit in accordance with the IT act.Theconstruction activity is one among the objects of the society.In most cases the construction for the members is done  on behalf of the mebers after charging the respective loan account.Therefore the construction is presumed to be undertaken by the members,amd therefore the benefit of deduction will go in favour of the memberalone,and the respective member is benefite.The question of deduction for the society,therefore does not arise.

alok arunkumar bhagat (PRACTICING LAWYER)     27 October 2008

Thank you sir for your guidence.


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