Jankalyan Gramin Bigarsheti Sahakari Pathsanstha Maryadit Asond Vs ITO (ITAT Pune)
The Income Tax Appellate Tribunal (ITAT) Pune addressed an appeal by a Cooperative Society, Jankalyan Gramin Bigarsheti Sahakari Pathsanstha Maryadit Asond, concerning the denial of a deduction under Section 80P of the Income Tax Act, 1961. The society had claimed deduc-tions under sections 80P(2)(a)(i) and 80P(2)(d), but the Assessing Officer (AO) disallowed the deduc-tion under 80P(2)(d) for interest earned from investments, arguing that the society failed to segregate investments made with cooperative societies and cooperative banks. The National Faceless Appeal Cen-tre (NFAC) upheld the AO’s decision, relying on rulings from the Supreme Court.
However, the ITAT Pune allowed the society’s appeal. The tribunal noted that the core issue was the de-duction under Section 80P(2)(d), which pertains to income derived from investments with other coop-erative societies. The ITAT cited consistent decisions from its Coordinate Benches, including Kolhapur District Central Co-op. Bank Kanista Sevakanchi Sahakar Pat Sanstha Ltd. Vs. ITO and The Ugar Sugar Works Kamgar & Dr. Shirgaokar Shaikshanik Trust Nokar Co-op Credit Society vs. ITO. These decisions established that interest earned from deposits with cooperative banks is also eligible for deduction under Section 80P(2)(d), as cooperative banks are essentially cooper-ative societies that have obtained banking licenses.
