TaxTMI 
TaxTMI 
2018 (11) TMI 1883
X X X X Extracts X X X X
X X X X Extracts X X X X
..../- u/s. 80P(2)(a)(i) of the Act by disregarding the fact that the interest was received on term deposit from SBI. 2) In the facts and circumstances of the case and in law, the learned Assessing Officer erred in disallowing deduction claimed of Rs. 10,34,000/- u/s. 80P(2)(a)(i) of the Act by disregarding the fact that the commission was received from MSEB. 3) In the facts and circumstances of the case and in law, the learned Assessing Officer erred in initiating penalty u/s. 271(1)(c) of the Act and interest u/s. 234A, B, C, & D. 4) In the facts and circumstances of the case and in law, the learned Commissioner of Income Tax (A) erred in confirming the contentions raised by the Assessing Officer. 2. Ground No. 3....
X X X X Extracts X X X X
X X X X Extracts X X X X
....upport of the decision rendered by the Tribunal in the case of Shri Saidatta Cooperative Credit Society Ltd. (supra), wherein the Tribunal has decided this issue against the assessee by considering the decision rendered by Hon'ble Supreme Court in the case of Todgars Cooperative Sale Society Ltd. (supra). However, we noticed that Hon'ble Karnataka High Court has also considered the decision of Todgars Cooperative Sale Society Ltd. (supra) in the case of Tumkur Merchants Souharda Credit Cooperative Ltd. (supra) and held that interest income is attributable to carrying on the business of the assessee and therefore it is liable to be deducted u/s. 80P(2)(a)(i) of the Act. The "SMC" Bench of the Tribunal in the case of Jaoli Taluk ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t of the business. A Cooperative Society which is carrying on the business of providing credit facilities to its members, earns profits and gains of business by providing credit facilities to its members. The interest income so derived or the capital, if not immediately required to be lent to the members, they cannot keep the said amount idle. If they deposit this amount in bank so as to earn interest, the said interest income is attributable to the profits and gains of the business of providing credit facilities to its members only. The society is not carrying on any separate business for earning such interest income. The income so derived is the amount of profits and gains of business attributable to the activity of carrying on the busine....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e, the amount which was invested in banks to earn interest was not an amount due to any members. It was not the liability. It was not shown as liability in their account. In fact this amount which is in the nature of profits and gains, was not immediately required by the assessee for lending money to the members, as there were no takers. Therefore they had deposited the money in a bank so as to earn interest. The said interest income is attributable to carrying on the business of banking and therefore it is liable to be deducted in terms of Section 80P(1) of the Act. In fact similar view is taken by the Andhra Pradesh High Court in the case of CIT v. Andhra Pradesh State co-operative Bank Ltd., [2011] 200 Taxman 220/12 taxmann.com66. In tha....
X X X X Extracts X X X X
X X X X Extracts X X X X
....mission from MSEB. During the year under consideration, the assessee received commission income of Rs. 10.84 lakhs and claimed as deduction u/s 80P(2)(a)(i) of the Act. The Assessing Officer took the view that the assessee has derived commission income from a non-member and hence the same is taxable u/s. 80P(2)(c) of the Act. Accordingly, by allowing deduction of Rs. 50,000/-, the Assessing Officer assessed balance amount of Rs. 10.34 lakhs as income of the assessee under the head "income from other sources". The learned CIT(A) also confirmed the same. 8. The Learned AR submitted that an identical issue was considered by the Pune SMC Bench in the case of Dronagiri Nagri Sahakari Patsanstha Maryadit (ITA No. 1183/Pune/2017 dated 20.6.2018....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... under section 80P of the Act in respect of locker rent income is covered by the decision of the Hon‟ble Supreme Court in the case of Mehsana District Central Co-op. Bank Ltd. (supra). Therefore, we set-aside the direction of the CIT(A) in this regard and hold that the assessee is eligible for deduction under section 80P of the Act in respect of this income. With respect to the income from running of Ambulance, while holding that the assessee is not eligible for deduction under section 80P(2)(a) or (b), we are in total agreement with the alternate plea of the assessee that the expenses attributable for the purpose operating such activity ought to have to be allowed on actual/proportionate basis. We are of the view that the action of t....