Deduction under section 80P and demonetisation cash deposits required fresh verification and remand for reconsideration.

Entitlement to deduction under section 80P(2)(a)(i) required fresh examination in light of the Supreme Court ruling in Mavilayi Service Co-operative Bank Ltd., so the issue was remanded to the Assessing Officer. The addition under section 68 read with section 115BBE for demonetisation-period cash deposits also required verification of the cash book, member confirmations, and other evidence before treating the amounts as unexplained, and this matter was likewise sent back for reconsideration. The commentary notes that the assessee obtained remand relief on the substantive tax issues, while the separate revision challenge did not survive for adjudication on merits in this order.

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Issues: (i) Whether the disallowance of deduction under section 80P(2)(a)(i) required fresh examination in the light of the Supreme Court decision in Mavilayi Service Co-operative Bank Ltd.; (ii) Whether the addition under section 68 read with section 115BBE for cash deposited during the demonetisation period could stand without proper verification of the cash book and confirmations.

Issue (i): Whether the disallowance of deduction under section 80P(2)(a)(i) required fresh examination in the light of the Supreme Court decision in Mavilayi Service Co-operative Bank Ltd.

Analysis: The claim for deduction turned on the assessee's status and the nature of its activities, and the record showed that the issue needed reconsideration in the light of the binding Supreme Court ruling in Mavilayi Service Co-operative Bank Ltd. The existing findings were therefore not treated as conclusive for final adjudication on this aspect.

Conclusion: The issue was restored to the Assessing Officer for fresh examination, and the assessee succeeded on this point for statistical purposes.

Issue (ii): Whether the addition under section 68 read with section 115BBE for cash deposited during the demonetisation period could stand without proper verification of the cash book and confirmations.

Analysis: The deposits made during the demonetisation period required verification of the cash book, member confirmations, and surrounding evidentiary material before treating the amount as unexplained. The matter also called for examination of the relevant departmental instructions governing such enquiries and the factual indicators relevant to genuineness of deposits.

Conclusion: The addition was not finally sustained and the matter was sent back for verification and reconsideration by the Assessing Officer.

Final Conclusion: The assessee obtained remand relief on the substantive tax issues, while the separate revision challenge did not survive for adjudication on merits in this order.

Ratio Decidendi: Where entitlement to deduction and the genuineness of demonetisation-period cash deposits depend on factual verification, the matter may be remanded for fresh adjudication in accordance with the governing precedent and evidence.

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