47. Exemption of income of co-operative societies.-

47. Exemption of income of co-operative societies.-


(1) Tax shall not be payable by a co-operative society

1[including a co-operative society carrying on the business of banking] in respect of-

2(a) so much of its income as is derived by it as a result  of such of its dealings  with  its  members  as  involve  sale  of  goods,  the  lending  of money or the lease of buildings and land which is for the personal use of such members, or where such member is a firm or an association of persons, for the personal use of the partners or members thereof;

(b) the entire income from business carried on by it, if it is engaged in the following:-


1 Omitted by F. A. 2012

2 Omitted by F. A. 2015


(i) agricultural or rural credit;

(ii) cottage industry;

(iii) marketing of agricultural produce of its members;

(iv) purchase of agricultural implements, seeds, livestock or other articles intended for agriculture for the purpose of supplying them to its members; or

(v) such processing, not being the performance of any manufacturing operation with the aid of power, of the agricultural produce of its members as is ordinarily employed by a cultivator to render marketable the agricultural produce raised by him;

1(c)  any  income  from  interest  and  dividends  derived  from  its investments with any other co-operative society; and

(d) any income derived from the letting of godowns or warehouses for the purpose of storage, processing or facilitating the marketing of commodities belonging or meant for sale to its members.

Explanation.-For the purpose of this section,-

(a) “cottage industry” means an enterprise, not being owned by a joint stock company which fulfils the following conditions, namely:-

(i) it is basically an enterprise in which the owner is the investor, a fulltime worker and the actual entrepreneur;

(ii) the capital invested in plant, machinery and equipment does not exceed 2[three lakh taka] at any time during the income year;

(iii) the number of workers, including the owner and the members of his family, shall not on any one twenty-four hour day during the income year, exceed 3[fifteen]; and

(iv) the owner of the enterprise or any member of his family does not own any other industrial or commercial enterprise either in his own name or in the name of any other person; and

(b) “member of his family”, in relation to the owner of an enterprise, means the parents, spouse and children dependent on the owner and employed in the enterprise, whether working full-time or part-time, or whether for or without any wages, remuneration or compensation in any form.

(2) Nothing contained in sub-section (1) shall apply to a co-operative society carrying on such business of insurance as is carried on by a mutual insurance association in respect of its profits and gains to which paragraph 8 of the Fourth Schedule applies.

1 Omitted by F. A. 2015

2 Subs for "one lakh taka" by F. A. 1995

2 Subs for "ten" by F. O. 1985


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