2025 (6) TMI 2172

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....olving proceedings under section 144 of the Income tax Act, 1961 (hereinafter referred to as 'the Act'). Heard both the parties. Case file perused. 2. It emerges during the course of hearing that both the learned lower authorities have disallowed the assessee's section 80P deduction claim under Chapter VI-A of Rs. 5,12,10,487/- representing interest income from savings and other deposit accounts etc. thereby treating the same as income from other sources in light of Totgars Co-operative Sale Society Ltd. Vs. ITO, Karnataka [2010] 188 Taxman 282 (SC) followed by yet another disallowance on business expenses amounting to Rs. 98,44,129/- respectively in the assessment order dated 22.09.2022 and upheld in the lower appellate dis....

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....ents out of surplus funds made with cooperative banks/societies, the cooperative bank is also a specie of cooperative society, therefore, the interest income earned by the cooperative society from the cooperative banks qualifies for deduction u/s. 80(P)(2)(d) of the Act. Such interest also qualifies for exemption u/s. 80P(2)(a)(i) as held by the Co-ordinate Bench of Pune Tribunal in the case of Nashik Road Nagari Sahkari Patsanstha Limited Vs. ITO in ITA No. 1700/PUN/2017 wherein the Tribunal held as under :- "9. We heard the rival submissions and perused the material on record. Admittedly, the appellant is a Cooperative society formed under the provisions of Maharashtra Cooperative Societies Act, 1960 with the objective of ac....

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....he activities of the society and, therefore, not eligible for exemption u/s. 80P(2)(a)(i) of the Act. However, the Hon'ble Karnataka High Court in the case of Tumkur Merchants Souharda Credit Cooperative Ltd. Vs. ITO (2015) 230 taxmann 309 (Kar.) and the Hon'ble Telangana and Hon'ble Andhra Pradesh High Court in the case of Vaveru Cooperative Rural Bank Ltd. v CIT [(2017) 396 ITR took a view that such interest income is attributable to the activities of the society and, therefore, eligible for exemption u/s. 80P(2)(a)(i) of the Act. The Coordinate Bench of Pune Benches in the case of M/s. Ratnatray Gramin Bigar Sheti Sah. Pat Sanstha Maryadit Vs. ITO (ITA Nos. 559/560/PUN/2018, dated 11-12- 2018) has taken view in favour of....