Co-operative bank deposit interest qualifies for Section 80P(2)(d) deduction when banks are registered co-operative societies under State law

Interest earned by a co-operative credit society on fixed deposits with co-operative banks qualifies for deduction under Section 80P(2)(d) where the recipient banks are registered as co-operative societies under the applicable State co-operative societies law. Applying the jurisdictional High Court ruling, the note treats a co-operative bank registered under that law as a co-operative society for this purpose. Accordingly, interest received from the three identified co-operative banks falls within the statutory deduction, and the claimed deduction is available.

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Issues: Whether interest earned by a co-operative credit society on fixed deposits with co-operative banks qualifies for deduction under Section 80P(2)(d) of the Income-tax Act, 1961.

Analysis: The interest was received solely from three co-operative banks. Applying the jurisdictional High Court ruling that a co-operative bank registered under the State co-operative societies law is a co-operative society, interest derived from such banks falls within the deduction available under Section 80P(2)(d).

Conclusion: Interest received from the three co-operative banks qualifies for deduction under Section 80P(2)(d); the assessee is entitled to the deduction claimed.

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