2021 (3) TMI 812

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....in law in upholding the proceedings under the provisions of Section 147 of the Income Tax Act, 1961. 2. That the Ld. CIT(A) and A.O. have erred in law in law and on facts denying the deduction under section 80P to the society in respect of interest paid without appreciating that the society is engaged in the business of providing credit of the Act its members. 3. That the Ld. CIT(A) and A.O. have erred in law in law and on facts in holding the funds as surplus funds of the society when the society in accordance with its bye laws required to keep the corpus funds of Rs. 20 Crores with bank. 4. That the Ld. CIT(A) and A.O. have erred in law in law and on facts in holding that the Co-operative bank is not a Co-operat....

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....ilities to its members. When the surpluses generated from these activities has been invested in a cooperative bank for short term period certain interest income is received which is linked to the activities of assessee of giving credit to its members, whereupon, the deduction of Section 80P(2)(a)(i) has been claimed. The Ld. Counsel has further submitted that the assessee has taken a specific plea in this respect before the Ld. CIT(A), however, the Ld. CIT(A) has failed to decide the same. 5. The next contention of the Ld. counsel for the assessee is that the assessee is otherwise eligible for deduction u/s. 80P(2)(d) of the Act. The relevant part of the said provisions for the sake of ready reference is reproduced as under:- "8....

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....allowed is interest or dividend derived by the co-operative society with investment in any another co-operative society. The meaning of co-operative society cannot be taken differently for the investor and for the Institution (investee). The provisions of section 80P(4) specifically states that the provisions of this section will not apply to any co-operative bank. The plain meaning of which is that the same interpretation is to be given in case of an investor co-operative society and to the bank in which the investment is made. The Co-operative Bank cannot be given a different interpretation as an investee Bank. Two different meanings cannot be ascribed to the same word in the same provision. 9. In view of this, we hold that the assesse....