2025 (12) TMI 726

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....e Act. 2. Assessee has raised following grounds of appeal : "1. On the facts and in the circumstances of the case and in law learned AO erred in rejecting deduction under section 80P(2)(a)(i) without appreciating the fact that the said profit is attributable to providing credit facilities to its members and without appreciating the facts of the case. It is your appellant's contention that appellant has disclosed correct profit in the return of income filed wherein, a loss from sugar business was disclosed correctly and appellant is entitled for deduction u/s. 80P as claimed. 2. On the facts and in the circumstances of the case and in law learned AO erred in not allowing deduction under section 80P(2)(a)(i) for a sum....

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.... interest from a Banking Company. (iv) High liabilities as compared to low income/receipts. 4. Subsequently, after serving of valid statutory notices, ld. Assessing Officer (AO) carried out assessment proceedings and noticed that the assessee has earned profit from the business of providing credit facilities to its Members and on the other hand has incurred loss on account of business of sugar manufacturing. Ld. AO based on his observations that assessee has not maintained separate books of account for each of the activities, the income from each business activity is estimated in proportion to credits made in profit and loss account and accordingly made addition of Rs. 50,10,957/-. 5. Aggrieved with the addition made by ld. A....

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....Rs. 65,25,467/- is arrived and the same has been claimed as deduction u/s. 80P(2)(a)(i) of the Act. 9. Ld. CIT(A) has affirmed the action of the ld.AO solely on the pretext that the assessee is not maintaining separate books of account and only the consolidated profit and loss account has been referred by both the lower authorities. 10. Before us, assessee has furnished audited statement of both the lines of business and separate audited profit and loss accounts of the business of credit facilities to the Members as well as sugar manufacturing business which are placed at pages 37 to 45 of the paper book and the same clearly indicates that the assessee has earned net profit from business of credit facilities to the Members at Rs. 4,17....