Deduction u/s 80P(2)(a)(i) was allowable on interest income from surplus funds in Bank Deposits

Nimshaskiya Madhyanik Shaley Karamchari Sahakari Sanstha Ltd Vs ITO (ITAT Nagar) Conclusion: Interest income from bank deposits is eligible for deduction under Section 80P(2)(a)(i) as the funds in the voluntary reserves which were utilized for investment by the co-operative banks were the funds generated from the banking business. Held: Assessee-a cooperative society of teaching and non-teaching employees of Maharashtra Government Middle Schools, contested an order from CIT (Appeals), which disallowed a deduction of ₹3,27,687 claimed for interest earned on deposits in a nationalised bank. I...