JUDGMENT 1. - This writ petition has been filed against the order dated 20th December 1996 passed by the Commissioner of Income Tax, Jaipur in exercise of his powers under Section 220(2A) of the Income Tax Act, 1961 (for short 'the Act'). The petitioner assesses had submitted an application to the Commissioner on 30.4.1996 seeking waiver of the interest amounting to Rs. 4,66,630/-. The petitioner had claimed deduction of Rs. 4,99,895/- being interest from its members under Section 80P(2)(d) of the Income, Tax.Act, 1961. Originally, such deduction was allowed to the extent of 85%. But later it was reduced to Rs. 50% which is equivalent to Rs. 2,49,947/-. Feeling aggrieved thereby, the petitioner filed an appeal before the Commissioner of Income Tax (Appeals) Rajasthan who vide his order dated 8.11.1979 dismissed the said appeal. The second appeal was also filed before the Income Tax Appellate Tribunal which by its order dated 31.3.1987 allowed the appeal in the light of the judgment of the Hon'ble Supreme Court in case of Cloth Trader (P) Ltd., 118 ITR 243 wherein it was held that deduction deserves to be allowed on the gross receipt and not on net receipt. 2. The respondent No. 2 moved an application under Section 256(2) of the Income Tax Act and the same was rejected by the Hon'ble Tribunal on 27.12.1981. Thereafter, respondent moved a reference application before this Court. During the pendency of the said reference application, the Hon'ble Supreme Court by its judgment report in (1985) 155 ITR 120 reversed its earlier judgment reported in 118 ITR 243 (supra). In these circumstances, the reference application of the respondent was allowed by this Court vide order dated 12.1.1995. Resultantly the petitioner was required to refund the amount of the above referred deduction and it was also required to pay interest for the period of delay amounting to Rs. 4,66,630/-. It is in regard to this amount of interest that the petitioner was seeking waiver of under Section 220(2A) of the Income Tax Act. The said application was rejected by the Commissioner vide impugned order dated 20.12.1996 which is under challenge in this writ petition. 3. 4,66,630/-. It is in regard to this amount of interest that the petitioner was seeking waiver of under Section 220(2A) of the Income Tax Act. The said application was rejected by the Commissioner vide impugned order dated 20.12.1996 which is under challenge in this writ petition. 3. Learned counsel for the petitioner has argued that learned Commissioner has failed to consider the fact that the petitioner became liable to make payment of interest no due to any fault on its part but because of change in the position of following reversal of its earlier judgment by the Hon'ble Supreme Court on account of which it was allowed aforementioned deduction of 50%. The petitioner Society has always been paying due tax to the department and abiding the law on the subject. The learned Commissioner has however not paid due respect to the fact that the petitioner is a Society related to cooperative movements and it had in the relevant year suffered huge losses and inorder to show this it had also filed balance sheet of relevant period along with return indicating such loss to the tune of Rs. 1,71,730/-. 4. On the other hand, learned counsel for the respondents Shri Anuroop Singhi argued that the order passed by the Commissioner does not suffer from any legal error or infirmity. The learned Commissioner has duly taken note of the fact that the petitioner is a Co-operative Society but he had also taken into account the financial position of the petitioner and has noted that in the financial year ending on 31st March 1985, the petitioner Society has shown the value of its assets over Rs. 2 Crores and therefore, it cannot be considered to be case of genuine hardship. 5. Having heard learned counsel for the petitioner, I find that the Commissioner whine rejecting the application of the petitioner has noted that the judgment of the Hon'ble Supreme Court in case of Distributors (Baroda) Pvt. Ltd. v. Union of India & Others, (1985) 155 ITR 129 Was only a reiteration of the original position of law as it stood in relation to correct interpretation of Section 80M. Even though that view is principally correct, that was the correct position of law with regard to interpretation of section 80M of the Act, it cannot be accepted that the reversal of its earlier view by the Hon'ble Supreme Court would completely obliterate the fact that the position of law which existed prior to Distributors (Baroda) Pvt. Ltd., was one which was enunciated by the Hon'ble Supreme Court in Cloth Traders Supra. Relying on the judgment of Hon'ble Supreme Court in Cloth Trade's case, the Income Tax Appellate Tribunal had allowed the appeal of the petitioner which in fact was later reversed by this Court in reference application of the respondents. That was so because during the pendency of the reference application, the Hon'ble Supreme Court overruled it's earlier decision in the case of Cloth Traders, reported in 118 ITR 243 due to which, the reference application was allowed and the petitioner was held entitled to the deduction to the extent of 15% only. 6. Another reasoning given by the learned Commissioner also belies the logic when he held that the petitioner Society owned assets carrying a value over Rs. 2 Crores on 31st March, 1995, therefore, it cannot be considered to be a case of genuine hardship. What was relevant was that the financial position of the petitioner Society which was reflecting as on the case in relation to which the dispute pertain. When the petitioner-Society had submitted return and balance sheet of the relevant year disclosing loss of As. 1,71,730/- and had claimed deduction @ 100% under Section 80P(2)(a) and interest under Section 80P(2)(d), its assets of the time when the impugned order was passed, could not form the basis to hold that it was not a case of genuine hardship. Moreover, in spite of having the assets of the worth mentioned in the impugned order, the petitioner-Society could still be having genuine hardship and facing difficulties of liquidity of funds and thus financial crisis. It was not a case of business of an individual businessman or a business firm or Company. Rajasthan Rajya Sahkari Upbhokta Sangh Ltd. is a Cooperative Society entitled at least to some latitude in exercise of discretion to waive the payment of interest in the petitioner facts obtaining in this case. 7. It was not a case of business of an individual businessman or a business firm or Company. Rajasthan Rajya Sahkari Upbhokta Sangh Ltd. is a Cooperative Society entitled at least to some latitude in exercise of discretion to waive the payment of interest in the petitioner facts obtaining in this case. 7. In the facts of the case, in my considered view, the matter requires reconsideration at the level of Commissioner of Income Tax. 8. The writ petition is accordingly allowed. The order dated 20.12.1996 is quashed and set aside and the matter is remanded to the Commissioner of Income Tax to consider and decide the application of the petitioner under Section 220(2A) of the Act afresh within six months from the date of receipt of the certified copy of this order. The amount of interest with regard to which waiver is claimed which is reported to have already deposited, shall abide by the outcome of the fresh order so passed by the Commissioner.There shall be no order as to costs.Writ Petition Allowed as aer above Directions. *******