2025 (2) TMI 1602

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.... confirming the denial of deduction u/s 80P of the Act in respect of interest of Rs. 5,22,601/- earned from nationalized banks, thereby holding that interest received from the schedule bank is not eligible for deduction u/s 80P of the Act. 03. The facts in brief are that the assessee is a primary agricultural credit co-operative society engaged in the business of banking or providing credit facilities to its members besides doing purchase of seeds, fertilizers, pesticides intended for agriculture operation for supplying to its members. During the year, the assessee has filed the return of income on 27.09.2018 by declaring total income at Rs. nil after claiming exempt income of Rs. 75,75,191/- u/s 80P(2)(a)(i) of the Act. The case of the ....

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....ociety and thus was not covered under Provisions of Section 80P(2)(a)(i) of the Act. 05. After hearing the rival contentions and perusing the materials available on record, I find that the assessee is primarily agricultural credit co-operative society engaged in providing credit facility to its members and also engaged in purchase of seeds, fertilizers, pesticides for agricultural operations for its members. I observe from the balance sheet of the assessee, a copy of which is available at page no.3 of the Paper Book, which contain the information as to the various resources available with the society. I note that the assessee has paid up share capital of Rs. 49.49 lacs while reserve and other funds were 198.37 lacs, Grants, other funds R....

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....sponding expenses may be determined deduction may be allowed in terms of Coordinate Bench decision in the case of M/s Panditpur Samabay Krishi Unnayan Samity Ltd. vs. ITO in ITA NO. 04/Kol/2022 dated 5.4.2022 and iii) the interest income from investments as per Section 64 read with Section 63 of the Multi State Co-operative Societies Act, 2022 out of surplus funds is to be treated as business income in terms of the Co-ordinate Bench decision in the case of Rabindra Bharati University Co-operative Credit Society Ltd. vs. ITO in ITA Nos. 584 & 585/Kol/2021 dated 11.11.2022. Accordingly, we direct the AO to frame the assessment in terms of aforesaid directions after affording a reasonable opportunity of hearing to the assesse....