Tribunal affirms co-op societies' deduction for interest/dividend income under Sec. 80P

The Tribunal upheld the grant of deduction u/s.80P for interest and dividend income by co-operative societies, citing consistent decisions by the Pune Benches. The Tribunal favored the view supporting the assessee, following the Karnataka High Court's decision due to conflicting views from other High Courts. It affirmed that co-operative societies, including those with investments in co-operative banks, are eligible for the deduction under u/s.80P(2)(d). The Tribunal dismissed the Revenue's appeals, concluding that the established precedent supported the co-operative societies' entitlement to the deduction.

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Issues:
1. Grant of deduction u/s.80P of the Income-tax Act, 1961 for interest and dividend income.
2. Eligibility of deduction u/s.80P(2)(a)(i) and 80P(2)(d) for co-operative societies.
3. Interpretation of the provisions related to deduction for interest income on investments/deposits with co-operative banks.
4. Consistency in the decisions of Pune Benches of the Tribunal regarding deduction u/s.80P for co-operative societies.

Analysis:
1. The appeals by the Revenue challenged the grant of deduction u/s.80P for interest and dividend income by co-operative societies for the assessment year 2018-19. The Assessing Officer initially denied the deduction, but the ld. CIT(A) reversed the assessment order in both cases. The common issue raised in these two appeals led the Tribunal to consolidate the orders for convenience.

2. The Tribunal referred to previous decisions by the Pune Benches in similar cases. In the first appeal, the Tribunal cited the case of Sureshdada Jain Nagari Sahakari Patsanstha Maryadit Vs. The Pr.CIT, where the availability of deduction u/s.80P on interest income was upheld. The Tribunal also discussed conflicting views from the Hon'ble Karnataka High Court and the Hon'ble Delhi High Court on the matter. Due to the absence of a direct judgment from the jurisdictional High Court, the Tribunal favored the view supporting the assessee, following the Karnataka High Court's decision.

3. Regarding the eligibility of deduction u/s.80P(2)(d), the Tribunal noted that co-operative societies, including those with investments/deposits in co-operative banks, are eligible for the deduction. This interpretation was supported by the definition of a co-operative society under the Act. The Tribunal cited the case of The Sesa Goa Employees Coop. Credit Society Ltd. to reinforce this stance.

4. The Tribunal emphasized the consistent position taken by the Pune Benches in various decisions, affirming that co-operative societies are entitled to deduction u/s.80P for interest income. Based on this established precedent, the Tribunal concluded that the impugned orders did not warrant any interference, leading to the dismissal of both appeals.

In conclusion, the Tribunal upheld the grant of deduction u/s.80P for interest and dividend income by co-operative societies, emphasizing the eligibility of such deductions and the consistent interpretation of the provisions by the Pune Benches.

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