Interest from co-operative bank deposits qualifies for co-operative society deduction despite the exclusion applicable to co-operative banks.

Section 80P(4) excludes co-operative banks, except specified primary co-operative credit institutions, from claiming deduction under section 80P; it does not prevent a co-operative society from claiming deduction under section 80P(2)(d) for interest on deposits with a co-operative bank. As a co-operative bank registered under applicable co-operative societies law falls within the definition of a co-operative society under section 2(19), such interest qualifies for deduction under section 80P(2)(d).

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Issues: Whether a co-operative society is entitled to deduction in respect of interest earned on deposits with co-operative banks.

Analysis: Section 80P(4) excludes co-operative banks, other than specified primary co-operative credit institutions, from claiming deduction under section 80P; it does not disqualify a co-operative society from claiming deduction under section 80P(2)(d) on interest from deposits with a co-operative bank. A co-operative bank registered under the applicable co-operative societies law falls within the definition of a co-operative society under section 2(19).

Conclusion: Interest earned by the assessee co-operative society on deposits with co-operative banks qualifies for deduction under section 80P(2)(d).

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