A co-operative society governed by the Karnataka Co-operative...

A co-operative society governed by the Karnataka Co-operative Societies Act was held entitled to deduction under section 80P(2)(a)(i) despite having nominal members, because nominal or associate membership is permitted by the governing statute and deduction cannot be denied on that ground alone. Interest on deposits with Apex Bank and savings account interest linked to statutory or operational banking requirements was treated as eligible for deduction under section 80P, while fixed deposit interest from SBI was directed to be assessed as income from other sources with admissible section 57 deduction for cost of funds and related expenses. A housing co-operative society advancing loans to its members was also held not to be excluded from section 80P.