The Union Budget 2023-24 has proposed several measures to support and strengthen the cooperative sector in India. The Finance Minister has announced that cooperatives will now be able to withdraw up to Rs 3 crore in cash annually without TDS.
Agriculture credit target will be increased to Rs 20 lakh crore with a focus on animal husbandry, dairy, and fisheries. Additionally, there will be no penalties for cash loans or deposits less than Rs 2 lakh made to or by primary agricultural credit societies or cooperative banks.
No Penalty for cash loan against co-operatives
It is proposed to amend section 269SS of the Act to provide that where a deposit is accepted by a primary agricultural credit society or a primary co-operative agricultural and rural development bank from its member or a loan is taken from a primary agricultural credit society or a primary co-operative agricultural and rural development bank by its member in cash, no penal consequence would arise, if the amount of such loan or deposit in cash is less than Rs 2 lakh.
Further, Section 269T of the Act is proposed to be amended to provide that where a deposit is repaid by a primary agricultural credit society or a primary co-operative agricultural and rural development bank to its member or such loan is repaid to a primary agricultural credit society or a primary co-operative agricultural and rural development bank by its member in cash, no penal consequence shall arise, if the amount of such loan or deposit in cash is less than Rs 2 lakh.
New cooperatives that commence manufacturing activities until March 3, 2024, will get the benefit of a lower tax rate of 15%, as presently available to new manufacturing companies. Opportunity provided to sugar co-operatives to claim payments made to sugarcane farmers for the period prior to assessment year 2016-17 as expenditure. This is expected to provide them almost Rs10,000 crore relief.
