TaxTMI 
TaxTMI 
2019 (12) TMI 80
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....r is neither erroneous nor prejudicial to the interest of the revenue as order under 143(3) was passed by ld assessing officer after considering and verifying the claim for deduction based on the submission made by the appellant before passing the assessment order and accordingly order under section 263 passed by Id Pr.CIT needs to be set aside and cancelled. (2) That learned Pr.CIT erred in relying on the judgement of Totagor Co-operative Sales V/s ITO. Karnataka (SC) 2010 which was for claiming classification of income as business income or other sources and corresponding deduction U/s.80P(2)(a) and not on Sec.80P(2)(d) for revising the order U/s.263 3). For that on the facts and in the circumstances of the case, there was sufficient material available before the AO on the basis of which it was evident that the interest earned on FDs with co-operative society which are also cooperative banks are deductible U/s.80P(2)(d) as claimed by appellant and in that view of the matter the AO had already formed a plausible opinion and had rightly allowed deduction U/s. 80P(2)(d) on such interest in the assessed income of the appellant for A.Y. 2014-15. (4) For that....
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....er as erroneous, insofar it was prejudicial to the interest of the revenue. Accordingly, the Pr.CIT not finding favour with the reply of the assessee, wherein the latter had tried to impress upon him that it was duly eligible for claim of deduction under Sec.80P(2), therein "set aside" the order of the A.O, with a direction to re-decide the issue afresh. 4. The assessee being aggrieved with the order of the Pr.CIT has carried the matter in appeal before us. It was submitted by the ld. A.R, that as the A.O while framing the assessment had after making necessary verifications taken a plausible view, therefore, the Pr. CIT had exceeded his jurisdiction by seeking to review the order passed by him in the garb of the revisional powers vested with him under Sec.263 of the Act. It was submitted by the ld. A.R, that on the relevant date on which the assessment was framed by the A.O under Sec.143(3), dated 14.09.2016, the issue as regards the eligibility of the assessee for claim of deduction under Sec.80P(2)(d) on interest income derived from investments/deposits lying with co-operative banks, was squarely covered by the order of the jurisdictional Tribunal viz. ITAT "A" Bench, Mumbai i....
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....ed on the amounts which were parked as investments/deposits with co-operative banks, other than a Primary Agricultural Credit Society or a Primary Co-operative Agricultural and Rural Development Bank. Observing, that the co-operative banks from where the assessee was in receipt of interest income were not co-operative societies, the Pr. CIT was of the view that the interest income earned on such investments/deposits would not be eligible for deduction under Sec. 80P(2)(d) of the Act. 7. After necessary deliberations, we are unable to persuade ourselves to be in agreement with the view taken by the Pr. CIT. Before proceeding any further, we may herein reproduce the relevant extract of the aforesaid statutory provision, viz. Sec. 80P(2)(d), as the same would have a strong bearing on the adjudication of the issue before us. "80P(2)(d) (1). Where in the case of an assessee being a co-operative society, the gross total income includes any income referred to in sub-section (2), there shall be deducted, in accordance with and subject to the provisions of this section, the sums specified in sub-section (2), in computing the total income of the assessee. (2). T....
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....co-operative banks pursuant to the insertion of subsection (4) to Sec. 80P would no more be entitled for claim of deduction under Sec. 80P of the Act, but as a co-operative bank continues to be a co-operative society registered under the Co-operative Societies Act, 1912 (2 of 1912), or under any other law for the time being in force in any State for the registration of co-operative societies, therefore, the interest income derived by a co-operative society from its investments held with a co-operative bank would be entitled for claim of deduction under Sec.80P(2)(d) of the Act. 8. We shall now advert to the judicial pronouncements that have been relied upon by the ld. A.R. We find that the issue that a co-operative society would be entitled for claim of deduction under Sec. 80P(2)(d) on the interest income derived from its investments held with a co-operative bank is covered in favour of the assessee in the following cases: (i) Land and Cooperative Housing Society Ltd. Vs. ITO (2017) 46 CCH 52 (Mum) (ii) M/s C. Green Cooperative Housing and Society Ltd. Vs. ITO-21(3)(2), Mumbai (ITA No. 1343/Mum/2017, dated 31.03.2017 (iii) Marvwanjee Cama Park Coop....