Rajura Nagari Sahakari Pat Sanstha Maryadit Vs ITO (ITAT Nagpur)
ITAT Nagpur held that co-operative society is eligible to claim deduction under section 80P of the Income Tax Act in respect of interest earned from credit facilities extended to nominal members. Accordingly, appeal of assessee allowed.
Facts- The assessee is a resident AOP (Association of Persons), engaged in the business of providing credit facilities to its members and assessed to tax. The case of the assessee was selected for limited scrutiny. AO disallowed deduction claimed under section 80P was disallowed and added back to the returned income. CIT(A) confirmed the assessment order passed by the Assessing Officer. Being aggrieved, the present appeal is filed.
Conclusion- The Tribunal, Bangalore in M/s. Shri Shivaji Maharaj Credit Co– operative Society v/s ITO held that the claim of the assessee is eligible to claim deduction u/s. 80P(2)(a)(i) of the act in respect of the interest earned by the assessee from credit facilities extended to members that includes nominal / associate members, based on the byelaws in force for the relevant assessment years.
Held that since the issue for our adjudication is squarely covered by the aforesaid decisions of the Tribunal cited supra, wherein the Tribunal has decided these issue in favour of the assessee and against the Revenue for the reasons stated above, consistent with the view taken therein, we set aside the impugned order passed by the learned CIT(A) by allowing the grounds of appeal raised by the assessee. In the result, assessee’s appeal stands allowed.
