TaxTMI 
TaxTMI 
2020 (12) TMI 970
X X X X Extracts X X X X
X X X X Extracts X X X X
....rative bank in the form of fixed deposits and earned interest income on the said investments. The assessee filed its return of income for the impugned assessment year declaring total income of Rs. 14,316/- after claiming deduction of Rs. 11,19,367/- under section 80P(2)(a)(i) of the Income Tax Act, 1961 ( in short 'the Act'). In scrutiny assessment proceedings, the Assessing Officer disallowed assessee's claim of deduction under section 80P(2)(a)(i) of the Act and also under section 80P(2)(d) in respect of interest income on fix deposits with Co-operative Banks. Aggrieved by the assessment order dated 27/03/2015 passed under section 143(3), the assessee filed appeal before the CIT(A). The first appellate authority rejected the contentions o....
X X X X Extracts X X X X
X X X X Extracts X X X X
....andas Udyog Bhavan Premises Co-op Society Ltd. Vs. ITO, 94 taxmann.com 15 (Mumbai) after examining the provisions of section and the decision of Hon'ble Karnataka High Court in the case of Totagars Co-operative Sale Society, 392 ITR 74 held that interest income derived by a co-operative society from investments with a co-operative bank, would be entitled for deduction under section 80P(2)(d) of the Act. The relevant extract of the order reads as under: - "7. We have deliberated at length on the issue under consideration and are unable to persuade ourselves to be in agreement with the view taken by the lower authorities. Before proceeding further, we may herein reproduce the relevant extract of the said statutory provision, viz. Sec. 80P....
X X X X Extracts X X X X
X X X X Extracts X X X X
....erative bank, other than a primary agricultural credit society or a primary co-operative agricultural and rural development bank, but however, are unable to subscribe to their view that the same shall also jeopardise the claim of deduction of a co-operative society under Sec. 80P(2)(d) in respect of the interest income on their investments parked with a co-operative bank. We have given a thoughtful consideration to the issue before us and are of the considered view that as long as it is proved that the interest income is being derived by a co-operative society from its investments made with any other co-operative society, the claim of deduction under the aforesaid statutory provision, viz. Sec. 80P(2)(d) would be duly available. We may here....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tive Housing and Society Ltd. (supra) (iii) Marwanjee Cama Park Cooperative Housing Society Ltd. (supra). We further find that the Hon'ble High Court of Karnataka in the case of Totagars Co-operative Sale Society (supra) and Hon'ble High Court of Gujarat in the case of State Bank Of India (supra), had also held that the interest income earned by the assessee on its investments held with a co-operative bank would be eligible for claim of deduction under Sec. 80P(2)(d) of the Act. Still further, we find that the CBDT Circular No. 14, dated 28.12.2006, as had been relied upon by the ld. A.R, also makes it clear beyond any scope of doubt, that the purpose behind enactment of sub-section (4) of Sec. 80P was to provide that the co-ope....
X X X X Extracts X X X X
X X X X Extracts X X X X
....order of the ITAT 'SMC' Bench, Mumbai in the case of Shri Sai Datta Co-operative Credit Society Ltd. (supra), would also not be of any assistance, for the reason that in the said matter the Tribunal had set aside the issue to the file of the assessing officer for fresh examination. That as regards the reliance placed by the ld. D.R on the judgment of the Hon'ble High Court of Karnataka in the case of Totagars cooperative Sale Society (supra), the High Court had concluded that a cooperative society would not be entitled to claim of deduction under Sec. 80P(2)(d). We however find that as held by the Hon'ble High Court of Bombay in the case of K. Subramanian v. Siemens India Ltd. [1983] 15 Taxman 594/[1985] 156 ITR 11 (Bom), wh....