TaxTMI 
TaxTMI 
2023 (10) TMI 1607
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.... both the appeals are same and hence, we are reproducing the grounds of ITA No. 660/Hyd/2022 for A.Y. 2016-17 only, for the sake of brevity and the same read as under : "1. The order of the learned First Appellate Authority is not correct either in law or on facts and in both. 2. The learned First Appellate Authority is not justified in confirming the action of the Assessing Officer denying deduction u/s 80P(2) in the proceedings u/s 154. The issue involved is debatable and hence cannot be subject matter of adjustments u/s 154. 3. The learned First Appellate Authority is not justified in confirming the action of the Assessing Officer denying deduction u/s 80P(2) in respect of interest received on deposits made in Nationalised Banks amounting to Rs. 6,77,560/- . " 3. As the facts and issues in both the appeals are same, we are reproducing the facts of appeal in ITA No. 660/Hyd/2022 for the sake of brevity. 4. The brief facts of the case are that assessee is an Association of Persons (AoP) engaged in carrying on the business of providing credit facilities to its members and earning the interest income on such credit facilities. It has filed its return....
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....sue under the garb of section 154 of the Act. Ld. AR further submitted that the co-ordinate Benches of the Tribunal have decided the issue in favour of the assessee and he has drawn our attention to the recent decision of SMC Bench dt.12.09.2023 in the case of assessee in ITA 432/Hyd/2023 (wherein one of us Judicial Member) has decided the issue vide paras 6 to 8 of the order as under : 6. Before me, Ld.AR submitted that the case of the assessee is covered with the decision of the Tribunal in its own case in ITA No.246/Hyd/2021 for A.Y. 2015-16, wherein the Tribunal vide Paragraphs 3 to 5 held as under : "3. We next advert the sole substantive issue between the parties, qua correctness of the Pr. CIT's identical revision direction treating the corresponding regular assessments, dated 28.6.2017, 29.6.2017 and 27.6.2017; respectively as erroneous ones causing prejudice to the interest of the Revenue on the ground that the Assessing Officer (s) had accepted these taxpayer identical section 80P(aa) deduction claims pertaining to the interest income derived from nationalized banks. Learned Pr. CIT holds that the hon'ble apex court's decision in Totgars Co-o....
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....r lordships have duly taken into consideration the hon'ble apex court's foregoing decision (supra). We therefore hold that both the Assessing Officers therein had not committed any error in not disallowing the assessees' section 80P(2)(d) deduction claims in issue qua the respective interest income derived form fixed deposit in nationalized banks. The PCITs' revision direction under challenge herein forming subject matter of these two appeals stand reversed on the very analogy therefore. We lastly quote hon'ble apex court's ITA Nos.284 & 286/Hyd/2021 landmark decision Malabar Industrial Co. Ltd. Vs. CIT 243 ITR 83 (SC) that an assessment has to be both erroneous as well as causing prejudice to the interest of revenue; simultaneously before the CIT or the PCIT; as the case may be, sets section 263 revision mechanism in motion. And that it is not each and every assessment which would attract revision proceedings but only those wherein the Assessing Officer has not taken one of the two possible views. We thus restore both the assessments herein as a necessary corollary. No other ground has been pressed before us". 5. We adopt the foregoing detailed dis....
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....cultural and rural development bank, the deduction would still be provided. Thus, co-operative banks are now specifically excluded from the ambit of section 80P of the Act. Further, it is also a matter of common knowledge that in order to do the business of a Co-operative bank It is imperative to have a licence from RBI, which the appellant did not possess. Thus, if the Banking Regulation Act 1949 is now to be seen, what is clear from section 3 r.w.s 56 is that a primary co-operative bank cannot be a primary agricultural credit society must be engaged in the business of banking as defined by section 5(b) of the Banking Regulation Act, 1949, which means that accepting, for the purpose of lending or investment of deposits of money from public, likewise, under section 22(1)(b) of the Banking Regulation Act, 1949 as applicable to co-operative Societies, no cooperative society shall carry on banking business in India, unless it is a co- operative bank and holds a licence issued in that behalf by the RBI, as opposed to this a primary agricultural credit society, the primary object of which is to provide financial accommodation to its members for agricultural purposes or....