TaxTMI 
TaxTMI 
2026 (7) TMI 1326
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....ment Centre [the learned AO] under section 143(3) read with sections 143(3A) and 143(3B) of the Income-tax Act, 1961 [the Act]. 2. The assessee is aggrieved by the order of the learned CIT(A) insofar as the deduction of Rs.11,46,460 claimed under section 80P of the Income-tax Act was denied. 3. Briefly stated, the assessee, a credit cooperative society, filed its return of income declaring nil income after claiming deduction of Rs.80,56,311 under section 80P of the Act. The return was processed under section 143(1) of the Income-tax Act on 09 February 2019, determining total income at Rs.53,000. The case was selected for limited scrutiny to verify the deduction claimed under Chapter VI-A and notice under section 143(2) was issued on 2....
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....to him, the assessee cannot therefore contend that the delay was due to sufficient cause. 7. We have carefully considered the rival submissions and perused the orders of the lower authorities. The assessee's case is that the delay of 168 days occurred because the appellate order was not served on the email address stated by it. This assertion is supported by an affidavit and has not been controverted by the learned departmental representative by producing any material to show that the appellate order was in fact served on the assessee at the email address mentioned in Form No. 35. The assessee has categorically stated the facts on affidavit. In these circumstances, we find that the assessee became aware of the appellate order only upon r....
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....ss of a primary agricultural credit co-operative society. He submitted that the assessee was required, under the Co-operative Societies Act, to place deposits with Kodagu District Central Co-operative Bank, from which it earned interest of Rs.11,46,460. According to him, this interest formed part of the business income attributable to the assessee's activities and therefore could not be disallowed by invoking section 80P(2)(d) of the Act. The assessee relied on the decisions of the Hon'ble Karnataka High Court in Tumkur Merchants Souharda Credit Co-operative Ltd. v. ITO, 55 taxmann.com 447, and the related decision reported at 2017 (1) TMI 1100 - KARNATAKA HIGH COURT The Pr. Commissioner of Income Tax, Versus the Totagars Co-operative Sale ....
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.... Commissioner of Income Tax, Versus The Totagars Co-operative Sale Society,[2017] 392 ITR 74, [2017] 78 taxmann.com 169 (Karnataka). 11. In rejoinder, the learned authorised representative submitted that the assessee's claim is under section 80P(2)(a)(i) of the Income-tax Act and not under section 80P(2)(d). He therefore contended that the decision cited by the learned departmental representative does not apply and that the issue should be decided in favour of the assessee. Without prejudice, he submitted that, even if the interest income is held taxable, the assessee should at least be allowed deduction for the cost of funds, as held by the Hon'ble Karnataka High Court in 2015 (4) TMI 829 - KARNATAKA HIGH COURTM/s The Totgars' Co-Op....
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.... co-operative society, its income is deductible under section 80P(2)(a)(i), as it is attributable to its business activities. It further submits that the deposits with Kodagu District Central Co-operative Bank were made from statutory funds in compliance with Rule 28 of the Karnataka Co-operative Societies Rules and were therefore required by law. 16. In the alternative, the assessee submits that, if the interest income is held to be taxable under section 80P(2)(d), deduction for the corresponding cost of funds should also be allowed. 17. As the material on record does not clearly establish whether the assessee claimed deduction before the Assessing Officer under section 80P(2)(a)(i) or section 80P(2)(d) of the Act, we are unable to a....