Case Law Details
Karinje Service Co-operative Society Taccode Ltd Vs ITO (ITAT Bangalore)
ITAT Bangalore held that if deduction under section 80P(2)(a)(i) of the Income Tax Act is rejected then the deduction on account of expense is allowable.
Facts-
The assessee is a Primary Agricultural Co-operative Society registered under the Karnataka Co-operative Socieites Act, 1959 and is engaged in providing agricultural credit facilities to the members of the society. The assessee received interest on investments made in SCDC Bank (a co-operative Bank) of a sum of Rs.17,63,679/-. The assessee claimed that the aforesaid interest income is originally for a deduction u/s. 80P(2)(a)(i) of the Income Tax Act, 1961.
The claim of the assessee was rejected by the AO based on the decision of the Hon’ble Karnataka High Court in the case of PCIT, Hubli Vs. Totgars Co-operative Sale Society Ltd., (2017) 83 Taxmann 140 (Karnataka). The alternative claim of the assessee for deduction u/s. 80P(2)(d) of the Act was also rejected by the AO by relying on the decision of the Hon’ble Karnataka High Court in the case of Totgars Co-operative Sale Society Ltd. The CIT(A) confirmed the order of the AO.
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