Appeal delay condoned, deduction upheld for cooperative society on interest income.

The delay in filing the appeal was condoned after the assessee provided satisfactory reasons, leading to the admission of the appeal for disposal on merits. The Tribunal upheld the validity of the claim of deduction under section 80P(2)(d) for a cooperative society on interest income from deposits with a cooperative bank meeting the criteria of a registered cooperative society. The Tribunal determined that the eligibility of a cooperative society for deduction under section 80P(2)(d) was not affected by section 80P(4), ultimately overturning the Principal Commissioner of Income Tax's decision and ruling in favor of the assessee.

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Issues involved:
The issue involves the condonation of delay in filing an appeal, the disputed claim of deduction under sections 80P(2)(a)(i) and 80P(2)(d) of the Income-tax Act, 1961, and the eligibility of a cooperative society for deduction on interest income from deposits with cooperative banks.

Condonation of Delay:
The appeal was time-barred by 340 days, but the delay was condoned after the assessee filed an affidavit explaining the reasons for the delay, which was found satisfactory. Consequently, the appeal was admitted for disposal on merits.

Disputed Claim of Deduction:
The Principal Commissioner of Income Tax (PCIT) invoked jurisdiction under section 263 of the Act to dispute the allowability of the claim of deduction under sections 80P(2)(a)(i) or 80P(2)(d) concerning interest income earned from deposits with cooperative banks. The Tribunal observed that the claim of deduction under section 80P(2)(d) was valid for a cooperative society on interest income from investments/deposits with a cooperative bank meeting the criteria of a registered cooperative society under the Act.

Eligibility of Cooperative Society for Deduction:
The Tribunal found that the provision of section 80P(4) did not affect the eligibility of a cooperative society for deduction under section 80P(2)(d) on interest income from deposits with a cooperative bank, provided the bank was a registered cooperative society as defined in the Act. Citing precedents, the Tribunal overturned the PCIT's decision, holding that the impugned order was unsustainable and allowed the appeal in favor of the assessee.

Separate Judgement:
No separate judgment was delivered by the judges in this case.

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