2021 (12) TMI 806

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....1961 (here-in-after referred to as "the Act") relevant to the Assessment Year 2016-17. 2. In response to the notice of hearing Shri Ankit Chokshi has sent an email praying for adjournment. However, with the assistance of Ld.D.R we have gone through the record and found that the main issue involved in this appeal relates to exclusion of interest income earned from Nationalized Bank for claiming of deduction u/s.80P(2) of the Act. The Ld.CIT(A) has followed the judgment of Hon'ble Jurisdictional High Court in the case of SBI 72 taxmann.com 64 and confirmed the disallowances. The Ld. First Appellate Authority has hardly made any detailed discussion in the impugned order. In view of above fact we declined the request for adjournment and hear....

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....8/- would not qualify for deduction u/s.80P(2)(a)(i) of the Act. Therefore, the deduction u/s.80P is not allowable for the interest income of Rs. 37,92,758/-. (After allowing proportionate expenditure: Addition Rs. 19,79,690/-) 5. Aggrieved assessee preferred an appeal to the learned CIT (A) who confirmed the order of the AO. 6. Being aggrieved by the order of the learned CIT (A) the assessee is in appeal before us. 7. The learned DR before us vehemently supported the order of the authorities below. 8. We have heard the ld. DR and perused the materials available on record. The provisions of section 80P(2)(a)(i) of the Act provides the deduction to a co-operative society engaged in the business of banking or providing cr....

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....ly, the Hon'ble Supreme Court in the case of Mavilayi Service Co-operative Bank Ltd. v. CIT reported in 123 taxmann.com 161 has held that wherein, the primary agricultural credit societies were held to be entitled to the benefit of the deduction contained in Section 80P(2)(a)(i) of the Act, notwithstanding the fact that the society may also be giving loans to its members which are not related to agriculture. However, if it is found that there are instances of loans being given to the non-members, profits attributable to such loans obviously were not liable to be deducted. The essence of this decision is that absolute denial of deduction under Section 80P(2)(a)(i) of the Act to the assessee's (cooperative societies) engaged in the provid....