TaxTMI 
TaxTMI 
2022 (12) TMI 755
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....P(2)(d) of the Income Tax Act 1961. Ground- 2. For that in the facts and in the circumstances of the case Commissioner of Income Tax (Appeals) National Faceless Appeal Centre, has erred for not considering the fact that appellant is a Primary Agricultural Credit Society enjoying the special provisions in the West Bengal Cooperative Societies Act 2006 as credit structure entity in Cooperative banking for banking for providing credit facilities to its members and the Interest Income arising from the banking activities are eligible for deduction under section 80P(2)(a)(i). Ground- 3. For that in the facts and in the circumstances of the case Commissioner of Income Tax (Appeals) National Faceless Appeal Centre, has erred in fact of considering the applicability of section 80P(4) of the Income Tax Act 1961 Ground- 4. For that in the facts and in the circumstances of the case Commissioner of Income Tax (Appeals) National Faceless Appeal Centre, has erred in not considering the provisions of section 80P(2)(d) and not allowing benefit to your appellant also by not considering the decision of the Apex Court in the case of National Thermal Power Company Limited vs.....
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....19 wrongly treating the interest income received from investments made in cooperative bank as income from 'other sources'. Mistakes as pointed out by the assessee were partly rectified and as per order passed u/s. 154 r.w.s 143(3) of the Act dt. 20-02-2020 after necessary rectification, assessed income recomputed at Rs.14,02, 814/-. 5. The assessee challenged the order passed u/s. 154 of the Act before the ld. CIT(A), but failed to succeed as the ld. CIT(A) held that firstly the assessee is not eligible for deduction u/s. 80P(2)(a)(i) of the Act for the alleged interest income, the issue which is pointed out is not apparent mistake subject to rectification and lastly directed the ld.AO that if the profits and gains from the activities of credit facilities and banking increases due to Interest Income being considered separately under other head, the appellant/assessee would be entitled to deduction u/s. 80P of the Act. 6. Aggrieved, now the assessee is in appeal before this Tribunal. 7. The Ld. Counsel for the assessee stated that the alleged interest income is received from investments made in co-operative bank and eligible for deduction u/s80P(2)(d) of the Act and ld. CIT....
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....operative credit societies which provide financial assistance to the society; (3) the State Government; (b) in the case of a co-operative society, being a primary society engaged in supplying milk, oilseeds, fruits or vegetables raised or grown by its members to- (i) a federal co-operative society, being a society engaged in the business of supplying milk, oilseeds, fruits, or vegetables, as the case may be; or (ii) the Government or a local authority; or (iii) a Government company53 as defined in section 617 of the Companies Act, 1956 (1 of 1956), or a corporation established by or under a Central, State or Provincial Act (being a company or corporation engaged in supplying milk, oilseeds, fruits or vegetables, as the case may be, to the public), the whole of the amount of profits and gains of such business; (c) in the case of a co-operative society engaged in activities other than those specified in clause (a) or clause (b) (either independently of, or in addition to, all or any of the activities so specified), so much of its profits and gains attributable to such activities as does not exceed,- (i) where suc....
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....ciety" shall have the meanings respectively assigned to them in Part V of the Banking Regulation Act, 1949 (10 of 1949); (b) "primary co-operative agricultural and rural development bank" means a society having its area of operation confined to a taluk and the principal object of which is to provide for long-term credit for agricultural and rural development activities. 11. As far as section 80P(4) of the Act, it only provides that provisions of section 80P shall not be applied in relation to any cooperative bank other than agricultural credit society or any agricultural rural bank. In simple words such cooperative Bank cannot claim deduction u/s.80P(2) & 80P(3) of the Act. Since the assessee is not a cooperative bank, but a Primary Agricultural Credit Society therefore, provisions of section 80P(4) of the Act is not applicable and thus, it is entitled to deduction u/s. 80P of the Act to the extent allowable as per relevant provisions. 12. Now the alleged interest income of Rs. 16,04,004/- is earned from idle funds invested in the bank and as far as deduction u/s. 80P(2)(i) is concerned, which refers to income earned from carrying on banking business or providing cre....