Section 80P deduction upheld where the assessee was found to be a credit society, not a co-operative bank.

Eligibility for deduction under section 80P turned on whether the assessee was a co-operative bank covered by the exclusion in section 80P(4) or a credit society outside that exclusion. On the factual record, the assessee was not engaged in banking activity, was not governed by the Banking Regulation Act, and advanced credit only to associate members. The Tribunal found no cogent evidence to bring it within the statutory category of a co-operative bank or within the explanations to section 80P(4), so the deduction claim was sustained and the Revenue's challenge failed.

---

---

Issues: Whether the assessee was a co-operative bank hit by the exclusion in section 80P(4) of the Income-tax Act, 1961, or a credit society entitled to deduction under section 80P.

Analysis: The assessee was found, on the factual record, not to be engaged in banking activity and not to be governed by the Banking Regulation Act. The material before the Tribunal did not rebut the CIT(A)'s findings that the assessee advanced credit only to its associate members and did not fall within the statutory category of a co-operative bank for the purpose of the exclusion clause. In the absence of cogent evidence showing that the assessee was covered by the explanations to section 80P(4), the finding of eligibility for deduction was left undisturbed.

Conclusion: The assessee was held entitled to the deduction, and the Revenue's challenge failed.

---