2025 (9) TMI 363

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....er dated 20.06.2025 passed for A.Y. 2018-19. 2. The assessee has raised the following grounds of appeal: "1. In law and on the facts and in the circumstances of the case, the order u/s 250 of the Act passed by the Ld. CIT(A) is bad in law and deserves to be quashed. 2. In law and in the facts and circumstances of the case of the Appellant, the Ld. CIT(A) has grossly erred in upholding disallowance of deduction claimed u/s 80P(2)(a)(i) of the Act amounting Rs. 3,66,426/- without appreciating that fact that any income received from the investment held with a Nationalized Bank is eligible for deduction under section 80P(2)(a)(i) of the Act. 3. The appellant craves leave to add, alter, amend and/or withdraw any gro....

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....,468 claimed by the assessee, under both sections 80P(2)(a)(i) and 80P(2)(d) of the Act. 5. Aggrieved by the assessment order, the assessee filed an appeal before Ld. CIT(A). The assessee submitted before Ld. CIT(A) that, even if the deduction under section 57 of the Act was not allowed, the same expenditure should have been allowed as a business expense. However, the CIT(A) pointed out that the Hon'ble Supreme Court, in the Totgars Co-operative Sale Society case, had clearly ruled that only operational income from business activities with members qualifies for deduction under Section 80P(2)(a) of the Act., and not income from investments such as interest from banks. Since the interest income in this case arose from investments made ....

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....8-19 (ITA No. 1636/Ahd/2024), wherein the ITAT dealt with the issue of taxability of interest income earned from nationalized banks. The brief facts of the case were that the assessee, a credit co-operative society, had filed its return declaring NIL income after claiming deduction under Section 80P(2)(a)(i) of the Act. However, the Assessing Officer disallowed this claim, treating the interest income of Rs. 26,31,656 from various banks as not eligible for deduction under Section 80P, and taxed the same under the head "Income from Other Sources." Before ITAT, the assessee submitted that the interest earned was from surplus funds which were deposited to meet the objectives of the society and should therefore qualify for deduction under Secti....