Tribunal affirms CIT(A)'s decision on income eligibility for deduction under section 80P(2)(a)

The Tribunal upheld the CIT(A)'s decision regarding the eligibility of income for deduction under section 80P(2)(a) of the Income Tax Act. The dispute arose from income received on fixed deposits from banks other than a cooperative bank. The Tribunal found in favor of the assessee, citing precedents from the Bombay High Court and a previous ITAT decision. The appeal was dismissed, affirming the CIT(A)'s ruling in favor of the assessee.

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Issues involved:
The correctness of CIT(A)'s order u/s 143(3) of the Income Tax Act, 1961 for the assessment year 2005-06 regarding the eligibility of income in the form of interest from investment of surplus fund with other banks for deduction u/s 80P(2)(a) of the Act.

Summary:

Issue 1: Eligibility of income for deduction u/s 80P(2)(a) of the Act
The Assessing Officer disputed the eligibility of income received on fixed deposits from banks other than a cooperative bank for the benefit of section 80P(2) of the Income Tax Act. The CIT(A) ruled in favor of the assessee based on a previous ITAT decision for the assessment year 2003-04. The Departmental Representative cited a Supreme Court judgment but the Tribunal found that the issue was already settled in favor of the assessee by the Bombay High Court's judgment in a similar case. The Tribunal upheld the CIT(A)'s decision and dismissed the appeal.

In conclusion, the Tribunal affirmed the CIT(A)'s decision, stating that the issue was already settled in favor of the assessee by the Bombay High Court's judgment and a previous ITAT decision. The appeal was dismissed.

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