Case Law Details
ITO Vs Mittal Court Premises Co. Op. Society Ltd (ITAT Mumbai)
ITAT Mumbai held that the interest income earned by a cooperative society on its investments held with a cooperative bank would be eligible for claim of deduction under Sec.80P(2)(d) of the Income Tax Act.
Facts- The assessee is Co-operative Society constituted by members (office tenement owners) for maintaining the Mittal Court Building. The assesse society returned income declaring in its return of income taxable income of 3,34,640/-. The AO noted that the assessee had invested funds as FDR with the Saraswat Co-op. Bank Ltd, Abhudaya Co-op Bank Ltd. National Co-op Bank Ltd. and the Shamrao Vithal Co-op Bank Ltd. The AO noted that the assessee had received interest income from the deposit made with the aforesaid Co-op. Bank to the tune of Rs.2,04,21,374/- on which it claimed deduction u/s 80P(2)(d) of the Act. So the AO issued notice and asked for justification for the claim of deduction u/s 80P(2)(d) of the Act. Pursuant to the same, the assessee submitted detailed explanation before the AO. However, the AO being not satisfied with the reply of the assessee disallowed deduction claimed.
Aggrieved, the assessee preferred an appeal before the Ld. CIT(A)/NFAC which has allowed the claim of assessee. Being aggrieved, revenue has preferred the present appeal.
Conclusion- Tribunal in the case of Palm Court M. Premises Co-operative Society Ltd vs. PCIT held that the interest income earned by a cooperative society on its investments held with a cooperative bank would be eligible for claim of deduction under Sec.80P(2)(d) of the Act.
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