TaxTMI 
TaxTMI 
2019 (1) TMI 349
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....eduction claimed by the assessee u/s 80P(2)(a)(i) of the Act on a sum of Rs. 12,17,900/- which was interest income derived from deposit of surplus funds in fixed deposits in State Bank of India Bellary. The deduction calmed by the assessee was not allowed by the Revenue authorities for the reason that the income which was claimed as deduction was interest income which was earned by the assessee on deposits and in view of the decision of the Hon'ble Supreme Court in the case of PCIT Vs. Totgars Co-operative Sale Society Ltd., 83 taxmann.com 140 interest income had to be regarded as 'income from other sources'. Since interest income was not income derived from the business of co-operative society, the deduction claimed by the assessee cannot ....
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....l income of the appellant or not under the facts of the case. Reliance is placed on the decision of the Supreme Court in the case of CIT vs. Karnataka State Cooperative Apex Bank, reported in 251 ITR 194. 6. The authorities below failed to appreciate that if the surplus funds not required immediately for business activity by the appellant bank are invested in Fixed Deposits, then the interest on such deposits is eligible for deduction under section 80P of the Act. Reliance is placed on the decision of the Jurisdictional Tribunal in the appellant's own case for the assessment year 2013-14 in ITA No. 2307/Bang/2016, dated 27.02.2017. 7. The authorities below ought to have appreciated that the appellant is a Primary Co-operative Agricu....
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....e Act. The learned DR relied on a subsequent decision of the Hon'ble Karnataka High Court in the case of PCIT Vs. Totgars Co-operative Sale Society Ltd. 395 ITR 611 (Karn). 6. We have carefully gone through the judgment relied by the learned DR. The facts of the case before the Hon'ble Karnataka High Court in the decision cited by the learned DR was that the Hon'ble Court was considering a case relating to Assessment Years 2007-08 to 2011-12. In case decided by the Hon'ble Supreme Court in the case of the very same Assessee, the Assessment years involved was AY 1991-92 to 1999-2000. The nature of interest income for all the AYs was identical. The bone of contention of the Assessee in AY 2007-08 to 2011-12 was that the deduction under Sect....