AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2016 (5) TMI 1486
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....mmissioner of Income Tax (Appeals) has erred in law and on merit in upholding the assessee's disallowance of claim of deduction under section 80P(2)(a)(i) of Rs. 26,74,651/-. 3. The learned Authorized Representative for the assessee at the outset pointed out that the issue raised in the present appeal is partly covered by the order of Tribunal in ITO Vs. M/s. Kundalika Nagari Sahakari Patsanstha Maryadit & Another in ITA No s.900/PN/2014, 898/PN/2014, CO Nos.34/PN/2015 & 32/PN/2015, relating to assessment year 2010-11, order 29.01.2016. 4. The learned Departmental Representative for the Revenue placed reliance on the orders of authorities below. 5. Briefly, in the facts of the case, the assessee was a co-operative society engaged in prov....
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....essed to tax as 'Income from other sources'. However, the Assessing Officer allowed deduction under section 80P(2)(c) of the Act at Rs. 50,000/- and determined the total income of the assessee at Rs. 26,24,651/-. 7. The CIT(A) upheld the order of Assessing Officer on both counts. 8. The assessee is in appeal before us on both the additions made totaling Rs. 26,74,651/-. The assessee has raised ground of appeal against addition of Rs. 26,74,651/-. It may be pointed out that the assessee was allowed deduction under section 80P(2)(c) of the Act to the tune of Rs. 50,000/- and balance income of Rs. 26,24,651/- was added in the hands of assessee. The learned Authorized Representative for the assessee fairly conceded that the interest income re....
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....,256/- 10. We find that similar issue of allowability of claim of deduction under section 80P(2)(a)(i) of the Act on bank deposits other than deposits with cooperative societies / co-operative banks, arose before the Tribunal in ITO Vs. M/s. Kundalika Nagari Sahakari Patsanstha Maryadit & Another (supra) and vide para 21, it was observed as under:- "21. The issue arising before us is whether the interest earned by the assessee on its investments is eligible for deduction under section 80P(2) of the Act. The learned Authorized Representative for the assessee has made several propositions before us. The first and foremost proposition raised by the learned Authorized Representative for the assessee is that the interest income is eligible fo....
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....other deposits and thereafter, provision of Rs. 41,62,699/-. The break-up of the investment of Rs. 5.55 crores is provided by the assessee at page 56 of the Paper Book. The break-up of the investment is in different FDs with cooperative societies totalling to Rs. 5.47 crores and the other investment in UTI Mutual Funds, Sundaram Finance, gratuity fund and shares totalling Rs. 7,48,216/-, totalling Rs. 5.55 crores. The assessee has further furnished the break-up of FDs with different co-operative banks at pages 57 to 68 of the Paper Book with sample copies of FDs at pages 69 to 75 of the Paper Book. The claim of the assessee before us is that it was engaged in the business of providing credit facilities to its members, out of loan received f....
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....his issue since we have already held the assessee to be eligible for claim of deduction under section 80P(2)(a)(i) of the Act. In view thereof, we also do not adjudicate the second alternate plea raised by the assessee that it is entitled to the claim of deduction under section 80P(2)(d) of the Act. However, the assessee is not entitled to the deduction under section 80P(2)(a)(i) of the Act relating to dividend received from UTI Mutual Funds and Sundaram Finance of Rs. 87,087/- and Rs. 88,519/-, which are to be included as income from other sources, on which the assessee is entitled to proportionate expenditure. Similarly, the profit of Rs. 25,786/- from other activities and services is not entitled to the claim of deduction under section 8....