2022 (7) TMI 899

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....ing Officer under section 143(3) of the Income Tax Act, 1961 (hereinafter referred to as "the Act"), dated 20.12.2019. 2. Grounds of appeal raised by the assessee are as follows:- "1. On the facts and circumstances of the case as well as law on the subject, the learned CIT(A) has erred in confirming the action of assessing officer in making addition of Rs.19,95,497/- on account of disallowance of interest (Rs.19,94,744/-) and dividend (Rs.753/-) income received from co-operative bank u/s 80P(2)(d) of the Act. 2. Without prejudice to the ground no.1 the ld. CIT(A) in making addition of entire amount of interest from banks and dividend in aggregate without granting proportionate deduction of interest expenses and overhead....

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....We have also gone through the various documentary evidences filed in the form of paper book (PB learned AR of the assessee. We have noted that during the assessment the Assessing Officer vide notice in section 143(2)7142(1) of the Act dated 31-8-2015 and 13-4-2016. The assessee filed its reply through its (AR) and furnished required details and. after examining the issue allowed the deductions under sec 80P(2)(of) as discussed in para 4 of the assessment order. The Assessing Officer passed assessment order 18- 10-2016. 12. The Id. PCIT before passing under section 263 of the Act. identified the issue regarding the claim of deduction under section 80P(2)(d) in its show cause notice dated 6-3-2019. The assessee in its reply date 3-20....

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....hould be considered by a Co-operative Society and interest earned by Co-operative Society from Cooperative Bank would necessarily be deductible un section 80P(1) of the Act. Further, the Hon'ble Jurisdictional High Court in Surat Vankar Sahakari Sangh Ltd. (supra) held that assessee co-operative society is eligible for deduction under section 80P(2)(d) in respect gross interest received from co-operative bank without adjusting interest paid to said bank. 16. The Co-ordinate Bench of Rajkot Tribunal in Surendarnagar District Cooperative Milk Producer Un Ltd. v. Dy. CIT [2019] 111 taxmann.com 69/179 ITD 690 (Rajkot Tribunal) also held the assessee operative society could not claim benefit under section 80P(2)(d) in respect of int....