Taking exception to the State intervention in the affairs of cooperative entities, Karnataka State Souharda Federal Cooperative Ltd. (KSSFCL) urged the government to make necessary amendments to the Karnataka Cooperative Societies Act to provide enough autonomy to the cooperatives.
“The original Cooperatives Act was cooperative-friendly. It had provided enough autonomy by minimising the State intervention. Successive governments have later amended the Act to enhance State control. We demand that the government make necessary amendments to restore the Act to its original position,” B.H. Krishna Reddy, president of KSSFCL said.
He added that Act, in its current status, has given the State more control over the cooperative entities by providing it with the powers to initiate suo motu actions, appoint members to governing bodies, and other interventions.
He was addressing a press conference here on Thursday.
Pointing to the financial difficulties that the cooperative societies were facing, Mr. Reddy demanded that the Union government to exempt cooperative societies from the ambit of income tax.
“Presently, the cooperative societies can claim tax deduction under Section 80 P of the Income Tax Act. However, the I-T Department is not allowing it. It is forcibly collecting taxes from even smaller cooperative societies by harassing and threatening through notices and other means. What struggling cooperatives actually need is a complete exception from income tax purview. If it is not possible, the government should allow the cooperative entities to claim the deduction. We are not demanding any financial aid from the government nor are we demanding an exemption from the Goods and Services Act,” he said.
Mr. Reddy said that over 4,700 cooperatives were in operation in the State and more than 1300 e-stamping centres are functioning generating around ₹1.5 crore royalty to the government daily.
“Over 50 lakh people in the State are associated with the cooperative movement and the sector has provided jobs to 50,000 people. It has shares worth ₹750 crore, deposits worth ₹15,000 crore and working capital of ₹18,000 crore. It has lending of ₹12,000 crore and an annual profit of ₹230 crore,” he said.
