2023 (7) TMI 860

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....llowing deduction u/s. 80P and confirmed addition amounting to Rs. 2,20,808/-. 2. Assessee is in the business of providing credit facilities to its members and is covered under section 80P and has rightly claimed deduction under section 80P(2)(a)(i) of the I.T. Act, 1961. 3. The assessee pray that deduction under section 80P(2)(a)(i) of the Act is eligible, hence addition of Rs. 2,20,808/- made by Ld. AO is unwarranted and bad in law and therefore be deleted. 4. Without prejudice to above, Assessee prays that Pro Rata Expenses for earning interest income be allowed. The Assessee prays that total expenditure incurred for the year stood at Rs. 16,09,394/-, total income for the year stood at Rs. 17,60,194/- and inter....

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....business activities and are in the nature of operational income. Therefore, the assessee has correctly claimed deduction under Section 80P(2)(a)(i) of the Act which provides that whole of the amount of profit and gains of business attributable to activities specified under Section 80P(2)(a)(i) to (vii) is deductible under Section 80P(1). The assessee is a primary cooperative society registered under Gujarat Co. Op. Society Act, 1961 and is eligible to get deduction under Section 80P(2)(a)(i) of the Act. The Ld. A.R. further submitted that the interest income on surplus fund invested cannot be taxed under Section 56 as it did not carry out any activity except in providing credit facilities to its members and that the funds were of operationa....

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....0,808/- as against total income of Rs. 17,60,194/- calculated at Rs. 2,01,890/- be allowed. The Ld. A.R. relied upon the decision of the Tribunal in case of Dhanlaxmi Credit Co-op. Society Ltd. vs. ITO (ITA No. 2426/Ahd/2013 order dated 24.01.2017). 6. The Ld. D.R. relied upon the assessment order and the order of the CIT(A). 7. Heard both the parties and perused all the relevant material available on record. It is pertinent to note that the assessee has earned interest income from deposits held with Nationalized Banks and thus, the contention of the assessee that the assessee is eligible for deduction under Section 80P(2)(a)(i) appears to be incorrect in light of the decision of State Bank of India vs. CIT 389 ITR 578 passed by the H....