TaxTMI 
TaxTMI 
2024 (8) TMI 1430
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....he case and has refused to admit the appeals. 2. Both the appeals are taken up together for disposal by this common order because it pertains to the same parties and the issue involved is also the same i.e., disallowance of benefits u/s. 80P(2)(d) of the Act to the assessee by the Ld. AO in the order dated 21.11.2017 and 30.04.2021 for A.Y. 2015-16 and 2018-19. The case pertaining to the A.Y. 2018-19 is taken as lead case and the facts of the said case are discussed for the purpose of disposal of both the appeals. 3. The assessee is a co-operative society and filed its return of income for the A.Y. 2018-19 on 30.10.2018 admitting a total income of Rs. Nil, after claiming deduction u/s. 80P(2)(d) of the Act. The case was taken up for scrutiny by way of issue of notice u/s. 143(2) dated 23.09.2019. Subsequently, notice u/s. 142(1) of the Act was issued on different dates calling for specific information. In response assessee has furnished the details such as Revised Balance Sheet, Income & Expenditure Statement, Computation of Income, etc. In the return of income filed by the assessee, assessee society has claimed u/s. 80P(2)(d) of the Act on the interest/dividend income of Rs. 1,0....
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....the status and nature of the appellant and thereafter denying benefit of Sec. 80P(2)(d) to the appellant. 3. In the facts & circumstances of the case and in law, the Ld CIT (A) erred by dismissing the appeal without any discussion on merit of the case ignoring the mandate of section 250(6). 4. In the facts & circumstances of the case and in law, the AO has erred by relying on case laws/citations, which are not applicable to the appellant's case." 7. The assessee in appeal before us and has raised following grounds for A.Y. 2018-19: "1. In the facts and circumstances of the case and especially in law, the Ld. AO has erred by disallowing deduction u/s 80P(2)(d) of Rs. 1,06,09,280/-, being interest income from Co-operative Banks which are also Co-operative Society, without appreciating/interpreting the evidences filed with AO and by wrongly interpreting the said section and ignoring established cases. 2. In the facts and circumstances of the case and in law, the AO has erred in mixing up and mis-interpreting the law and provisions of sec 80P(2)d vis-a-vis 80P(4) of Income Tax act 1961, ignoring the status and nature of the appellant and thereafter denying benefit of Sec. ....
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....mitted that the term cooperative society is much wider and includes a Cooperative Bank also and that this proposition has been upheld in various judicial pronouncements. The ld. AR also submitted that the Co- ordinate Bench has been consistently holding that interest received from deposits with Co-operative Bank is also eligible for deduction under section 80P(2)(d) of the Act and in this regard placed reliance on the decision of the Co-operative Bank in the case of Pathare Prabhu Co-operative Housing Society Ltd. Vs ITO [2023] 153 taxmann.com 714 (Mumbai - Trib.) and Kona Seema Co-operative Housing Society Ltd. in ITA No. 2024/Mum/2023 dated 08.11.2023. The ld. AR also brought to our attention that a similar view is held by the Co-ordinate bench in a recent decision dated 05.04.2024 in the case of Shivsahyadri Sahakari Patpedhi Maryadit Vs. ITO in ITA No. 3829/Mum/2023. Accordingly the ld AR prayed that the disallowance made towards deduction claimed under section 80P(2)(d) be deleted. 5. The ld. DR on the other hand submitted that the Hon'ble Gujarat High Court in the case of Katlary Kariyana Merchant Sahkari Vs. (ACIT 327 CTR 138) has held that the assessee is not entitled....
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....nder the Co-operative Societies Act, 1912 (2 of 1912), or under any other law for the time being in force in any State for the registration of co-operative societies ;" 8. In the present case, there is no dispute that the assessee is a Cooperative Housing Society. Thus, if any income as referred to in sub-section (2) to section 80P of the Act is included in the gross total income of the assessee, the same shall be allowed as a deduction. It is pertinent to note that since the assessee is registered under the Maharashtra Co-operative Societies Act, 1960, it is required to invest or deposit its funds in one of the modes provided in section 70 of the aforesaid Act, which includes investment or deposit of funds in the District Central Co-operative Bank or the State Cooperative Bank. Accordingly, the assessee kept the deposits in Saraswat Cooperative Bank Ltd and Maharashtra State Co-operative Bank Ltd and earned interest, which was claimed as a deduction under section 80P(2)(d) of the Act. The deduction under section 80P(2)(d) of the Act was denied on the basis that the Saraswat Co-operative Bank Ltd and Maharashtra State Co-operative Bank Ltd are multi-state scheduled banks and ther....
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....respect of income of co- operative societies: (1) .................. (2) The sums referred to in sub-section (1) shall be the following, namely: - (a) to (c)........... (d) "in respect of any income by way of interest or dividends derived by the co-operative society from its investment with any other co-operative society, the whole of such income" 9. A reading of the above said provision makes it clear that in the event if any Co-operative Society derived income by way of interest from investment made in any other Co-operative Society the whole such interest is eligible for deduction. Now the issue is as to whether the Co- operative Bank would fall within the purview of the term 'Co-operative Society'. In the present case, the petitioner produced a document to show that the Cooperative Bank, where they have made investments was registered under the Tamil Nadu Co-operative Societies Act, 1983 on 20.5.2003. In this regard, he also produced a copy of the Certificate of Incorporation of the said Co-operative Bank. Therefore, it is clear that the investment made by the petitioner is a Co- operative Bank registered under the Co-operative Societies Act. The Income Tax Ac....