TaxTMI 
TaxTMI 
2025 (4) TMI 1919
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....ome Tax Act, 1961 (in short 'the Act') for the A.Y. 2021-22. 2. In the instant case, the Assessee during the year under consideration has earned the interest income of Rs. 15,93,047/- from co-operative banks as detailed below: SR NO. NAME OF THE BANK AMOUNT (Rs). 1 Saraswat Co-operative Bank 7,13,347 2 Shamrao Vithal Co-operative Bank 4,43,023 3 Maharashtra State Co-operative Bank 4,36,677 Total 15,93,047 And accordingly claimed the said amount of Rs. 15,93,047/- as deduction u/s 80P(2)(d) of the Act. Though the CPC vide intimation dated 19.10.2022 u/s 143(1) of the Act processed the said claim and allowed the deduction to the extent of Rs. 28,461/-, however, disallowed the remaining....
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....uction in the present case. As per the provisions of section 80P(1) of the Act, the income referred to in sub-section (2) to section 80P shall be allowed as a deduction to an assessee being a Co-operative Society. Further, section 80P(2)(d) of the Act, reads as under: "80P. Deduction in respect of income of co-operative societies. (1) ...... (2) The sums referred to in sub-section (1) shall be the following, namely:- (a) ..... (b) ..... (c) ..... (d) in respect of any income by way of interest or dividends derived by the cooperative society from its investments with any other co-operative society, the whole of such income;" 10. Thus, for the purpose of provisions of sec....
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....80P(2)(d) of the Act on the basis that the Co-operative Bank is covered under the provisions of section 80P(4) of the Act. We find that the Hon'ble Supreme Court in Mavilayi Service Cooperative Bank Ltd. vs CIT, Calicut, [2021] 431 ITR 1 (SC) while analysing the provisions of section 80P(4) of the Act held that section 80P(4) is a proviso to the main provision contained in section 80P(1) and (2) and excludes only Cooperative Banks, which are Co-operative Societies and also possesses a licence from RBI to do banking business. The Hon'ble Supreme Court further held that the limited object of section 80P(4) is to exclude Co-operative Banks that function at par with other commercial banks i.e. which lend money to members of the public. Thus, we....
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.... 80P(2)(d) is that the interest income should have been derived from the investments made by the assessee co-operative society with any other cooperative society. We though are in agreement with the observations of the lower authorities that with the insertion of Subsection (4) of Sec. 80P, vide the Finance Act, 2006, with effect from 01.04.2007, the provisions of Sec. 80P would no more be applicable in relation to any cooperative bank, other than a primary agricultural credit society or a primary co-operative agricultural and rural development bank, but however, are unable to subscribe to their view that the same shall also jeopardise the claim of deduction of a cooperative society under Sec. 80P(2)(d) in respect of the interest income on ....
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....e upon the decision of the Hon'ble Karnataka High Court in Pr.CIT v/s Totagars Co-operative Sales Society, [2017] 395 ITR 611 (Karn.), wherein it was held that interest earned by the assessee, a Co-operative Society, from surplus deposits kept with a Cooperative Bank, was not eligible for deduction under section 80P(2)(d) of the Act. We find that in an earlier decision the Hon'ble Karnataka High Court in Pr.CIT v/s Totagars Co-operative Sales Society, [2017] 392 ITR 74 (Karn.) held that according to section 80P(2)(d) of the Act, the amount of interest earned from a Co-operative Society Bank would be deductable from the gross income of the Cooperative Society in order to assess its total income. Thus, there are divergent views of the same Ho....