Section 80P Win for Credit Societies – Savings Bank Interest Is Business-Attributable

Coimbatore Co-Operative- Housing Society Ltd. Vs ITO (ITAT Chennai) The ITAT Chennai allowed the appeal of a co-operative credit housing society and held that interest of ₹11.25 lakh earned on a savings bank account with Axis Bank is eligible for deduction u/s 80P(2)(a)(i). The AO had originally allowed the claim, but later PCIT invoked u/s 263, leading to reassessment and disallowance on the ground that bank interest is not business income, relying on Totgars and Citizen Co-operative Society. The CIT(A) affirmed the disallowance. Reversing the authorities below, the Tribunal held that the a...