Bhairavnath Multi State Co.op. Credit Society Limited Vs ITO (ITAT Pune)
Interest from Co-op Banks = 80P(2)(d) Deduction Allowed: Pune ITAT Follows Consistent View
The Pune Bench “B” of the ITAT allowed the appeal of Shri Bhairavnath Multi State Co-op. Credit Society Ltd. vs. ITO, Ward-3, Satara, ITA No. 2576/PUN/2025, AY 2020-21, vide order dated 18.12.2025, and held that interest income earned from investments with Cooperative Banks is eligible for deduction u/s 80P(2)(d)
The Assessee, a multi-state co-operative credit society, earned interest of ₹3.87 crore from deposits/investments with Cooperative Banks. The AO denied deduction u/s 80P(2)(d), which was affirmed by NFAC-CIT(A). Before the Tribunal, the Assessee pointed out that the same issue had already been decided in its favour in earlier years and that the Pune ITAT has consistently held that Cooperative Banks are essentially Cooperative Societies, merely carrying banking licences.
The Tribunal observed that the issue is no longer res integra and relied on a catena of coordinate bench decisions, including Annapurna Nagari Sahkari Pathsanstha Maryadit Yawal vs. ITO (ITA No. 313/PUN/2025) and earlier Pune Bench rulings, which categorically held that interest earned from deposits with Cooperative Banks qualifies for deduction u/s 80P(2)(d).
Rejecting the Revenue’s stand, the Tribunal set aside the order of CIT(A) and directed the AO to allow the full deduction u/s 80P(2)(d) on interest income from Cooperative Banks. Consequently, the Assessee’s appeal was allowed in full.
FULL TEXT OF THE ORDER OF ITAT PUNE
