2025 (12) TMI 493

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....sment year (AY) 2017-18. 2. The grounds of appeal raised by the assessee are as under: "1. That the CIT(A) erred in confirming the disallowance of deduction u/s 80P(2)(d) on Interest and dividend received from Co-op. Bank of Rs. 1,84,177/-. 2. That the deduction claimed u/s 80P(2)(d) of Rs. 1,84,177/- may kindly be allowed. 3. The appellant craves leave to add, amend, alter, vary and/or withdraw any or all the above grounds of Appeal." 3. The facts of the case in brief are that the assessee filed its return of income for AY 2017-18 on 15.08.2017, declaring total income of Rs. Nil. The was selected for limited scrutiny through CASS for large deduction under Chapter VI- A of the Act from total income. The asse....

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....s 80P(2)(d) of the Act. Total income was assessed at Rs. 1,34,177/- as against returned income of Rs. Nil. 4. Aggrieved by the order of AO, the assessee filed the appeal before the CIT(A). The CIT(A) reproduced the findings of the AO, which is at pages 3 to 9 of his appellate order. The submission of the appellant is reproduced at pages 10 to 20 of his appellate order. He observed that the interest and dividend income of Rs. 1,84,177/- has been earned from the Surat District Cooperative bank. As per section 80(P)(2)(d) of the Act, interest earned ought to be out of investment from cooperative society. He relied on the decisions of Totagar's Co-op. Sales Society Ltd. vs. ITO, 322 ITR 283 (SC), SBI vs. CIT, 72 taxmann.com 64 (Guj.) and sus....

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...., dated 20.12.2023 (xv) Vishal Co-operative Housing Services Society Limited vs. ITO, in ITA No.886/SRT/2023, (xvi) Althan Bhatar Co-operative Credit Society Ltd vs. ACIT, ITA No.143/SRT/2024, dated 30.05.2024 (xvii) Shree Laxmi Co-Op. Savings & Credit Society Ltd. vs. ACIT, ITA No.200/SRT/2024, dated 10/06/2024 and (xviii) PCIT vs. Ashwinkumar Arban Co-operative Society Ltd., (2024) 168 taxmann.com 314 (Guj.). The ld. AR submitted that the Hon'ble Gujarat High Court in case of Ashwanikumar Arban Co-operative Society Ltd. (supra) has considered and distinguished the order passed by the Hon'ble Supreme Court in case of Totagars Co-operative Sales Society Ltd. (supra) and held that deduction u/s 80P(2)(d) is available to Co- operative Societi....

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....a in view of the decision of this Court in case of Katlary Kariyana Merchant Sahkari Sarafi Mandali Ltd. (supra) as well as in case of State Bank of India (supra) wherein it was held that the deduction of under section 80P(2)(d) of the Act is available to the cooperative societies on the income earned as interest on the investment made with the cooperative bank which in turn, is a cooperative society itself. .............. 33. In view of the above dictum of law as well as the provisions of the Act which are considered we are of the opinion that the provisions of section 80P(2)(d) would be applicable in the facts of the case and the PCIT was not justified in invoking revisional powers under section 263 of the Act which is r....