TaxTMI 
TaxTMI 
2021 (8) TMI 597
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....peals, we are, therefore, proceeding to dispose them off by this consolidated order for the sake of convenience. 2. The assessee, a Co-operative society registered under the Maharashtra Co-operative Societies Act, 1960 filed return with Nil income after claiming deduction u/s 80P of the Act for the A.Y. 2007-08. It earned profit of Rs. 3,01,69,574 from sale of units of various mutual funds, which was claimed as deductible u/s 80P(2)(a)(i) of the Act. The AO opined that the activity of making investment in mutual funds or income from mutual funds did not fall under the head 'Business of banking' as these transactions were not with the members of assessee society and hence no deduction u/s 80P was admissible. He observed that total expenses ....
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....n, the assessee was not entitled to deduction u/s 80P(2)(a)(i). He held the gain on sale of mutual funds, etc. as falling under the head 'Capital gains' as against the AO's determination of the same as 'Business income'. Thereafter, he directed the AO to allow set off in terms of section 74. The third direction of ld. CIT(A) was that the interest earned from FDRs, etc. placed with the nationalized banks should be taxed under the head `Income from other sources'. Aggrieved thereby, the Revenue has come up in appeal before the Tribunal. 4. We have heard the rival submissions through the Virtual Court and scanned through the relevant material on record. It is found an undisputed position that the assessee was set up by the Government of ....
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....ources' and cannot be construed as income from business. We, therefore, accord our imprimatur to the finding given by the ld. CIT(A) in this regard. 5. The last contention of Revenue is about allowing set off of loss against the income from transfer of capital gains. In this regard, it is seen that the ld. CIT(A) directed to allow the set off in terms of section 74 of the Act. In principle, we hold that the assessee is entitled to set off the loss from mutual funds, etc. against the income from mutual funds, etc. However, this exercise requires examination of the amount of loss incurred from sale of mutual funds, etc. during the year and the amount of loss brought forward from earlier years eligible for set off against income from mutual f....
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....rds profit on sale of units of mutual funds, interest on Govt. securities and interest from nationalized banks by not allowing deduction u/s 80P of the Act. Thereafter, the penalty was imposed u/s.271(1)(c), which came to be deleted in the first appeal. The Revenue has come up in appeal before the Tribunal. 9. We have heard the rival submissions through the Virtual Court and scanned through the relevant material on record. It is seen that the case of the assessee is that the AO did not strike off the irrelevant limb in the notice issued u/s.274 r.w.s. 271(1)(c) of the Act. We have examined the notice u/s.274 for the assessment year 2008-09, whose copy has been placed at page 32A of the paper book in which both the limbs are present, namely....