2023 (7) TMI 904

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....he circumstances of the case and in law, the Honorable Commissioner of Income Tax (Appeal) erred in upholding the adjustments by way of making disallowance of deduction u/s 80P by Centralized Processing Centre (CPC), Bengaluru to the returned income without giving any intimation for making any adjustments of disallowing the deduction claimed by the Appellant u/s 80P of Rs 4,89,194/-. 2. On the facts and in the circumstances of the case, the Appellant submits that the Honorable Commissioner of Income Tax (Appeal) erred in disallowing claim of deduction of Rs. 4,89,194/- u/s 80P (2)(d) of the Income Tax Act, 1961 in respect of interest income earned on investment in Fixed Deposit with Co operative Bank namely Kalupur Commercial Co-Operative....

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....earlier decision of Citizen Cooperative Society Ltd (supra):- "The following propositions may be culled out from the judgment: (I) That section 80P of the IT Act in a benevolent provision which was enacted by Parliament in order to encourage and promote the growth of the c operative sector generally in the economic life of the country and must, therefore, be read liberally and in favour of the assessee; (ii) That once the assessee is entitled to avail of deduction, the entire amount of profits and gains of business that are attributable to any one or more activities mentioned in subsection (2) of section 80P must be given by way deduction; (iii) That this Court in Kerala State Cooperative Marketing Federation Ltd and Ors (supra) has....

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....der section 234B & 234C is void ab initio. On the facts and in the circumstances of the case and in law, the CPC erred in charging interest u/s 234B of Rs. 34,588/- AND u/s 234C of Rs. 9,863/- which is wrong and contrary to the facts and circumstances of the case, provisions of the Act and the Rules made thereunder." 3. The assessee is a cooperative housing society filed its return of income for A.Y. 2021-22 on 07.12.2021. The assessee claimed deduction of Rs. 4,89,194/- under Section 80P(2)(d) of the Income Tax Act. The return of income was processed under Section 143(1) of the Act by the CPC wherein the said deduction was not granted and the total income was computed under Section 143(1) at Rs. 6,38,270/- thereby resulting into demand ....