2019 (8) TMI 1193

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....2019, 22.3.2019 and 12.3.2019 of CIT(A)-Managaluru relating to AY 2016-17, 2016-17 & 2015-16 respectively. 2. Since some common issues are involved in these three appeals, we heard these appeals together and deem it convenient to pass a common order. 3. The first common issue for consideration in all the three appeals is whether the revenue authorities were justified in rejecting the claim of the Assessee for deduction u/s.80P(2)(a)(i) of the Income Tax Act, 1961 (Act). The quantum of deduction claimed by the each of the Assessee is a sum of Rs. 30,89,462/- by the Assessee in ITA No.706/Bang/2019, Rs. 33,58,900/- by the Assessee in ITA No.764/Bang/2019 and a sum of Rs. 47,52,224/- by the Assessee in ITA No.941/Bang/2019. 4. The sec....

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....to vote and therefore the principle of mutuality viz., identity of the contributors and recipients of the profit being in the hands of the one and same persons was absent. He therefore denied the benefit of deduction u/s.80P(2)(a)(i) of the Act. On appeal by the Assessee, the CIT(A) confirmed the order of the AO. Hence, these appeals by the Assessee before the Tribunal. 6. At the time of hearing the parties agreed that identical issue was considered by a co-ordinate Bench of ITAT Bangalore in the case of M/S.Hemmadi Fishermen's Primary Co-operative Society Ltd. Vs. The ITO, Ward-2, Udupi in ITA No.774/Bang/2019 (AY 2016-17) order dated 28.6.2019 and it was held therein that the decision of the Hon'ble Supreme Court in the case of Citi....

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....upreme Court in the case of Totgar's Co-operative Sales Society Ltd., (Supra). 8. Aggrieved by the order of the CIT(A), the assessee is in appeal before the Tribunal. We have heard the rival submissions. The learned AR relied on the decision of the Hon'ble Karnataka High Court in the case of Tumkur Merchants Souharda Cred Cooperative Society Ltd. Vs. ITO 230 taxman 309 (Karn) wherein the Hon'ble Karnataka High Court considered the decision of the Hon'ble Apex Court in the case of The Totgar's Co-operative Sales Society (supra) and held that interest income in respect of temporary parkiong of own surplus funds not immediately required is eligible for deduction u/s.80P(2)(a)(i) of the Act. The learned DR relied on a subsequent decision of ....

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....e allowed under Clause (d) of Sec.80P(2) of the Act. The Hon'ble Karnataka High Court followed the decision of the supreme Court in The Totgars Co-operative Sales Society Ltd. (supra) and held that interest earned from Schedule bank or cooperative bank is assessable under the head income from other sources and therefore the provisions of Sec.80P(2)(d)of the Act was not applicable to such interest income. It is thus clear that the source of funds out of which investments were made remained the same in AY 2007-08 to 2011-12 and in AY 1991-92 to 1999-2000 decided by the Hon'ble Supreme Court. Therefore whether the source of funds were Assessee's own funds or out of liability was not subject matter of the decision of the Hon'ble Karnataka High ....