Interest earned by co-operative society on investment with co-operative bank deductible u/s 80P(2)(d)

Totgars’ Co-operative Sale Society Ltd Vs ACIT (ITAT Bangalore)

ITAT Bangalore held that the interest income earned by a cooperative society on its investments held with a cooperative bank would be eligible for claim of deduction under Sec.80P(2)(d) of the Income Tax Act.

Facts- The assessee is a cooperative society and is carrying on the activities of marketing agricultural produce grown by the members and providing credit facilities to the members by advancing loans to them.

The appellant has preferred the present appeal contending that CIT(A) has erred in confirming action of AO that interest received by the appellant from co-operative banks is not eligible for deduction u/s. 80P(2)(d) of the Income Tax Act.

Conclusion- Hon’ble Gujarat High Court in the case of State Bank Of India Vs. CIT held, that the interest income earned by a co-operative society on its investments held with a cooperative bank would be eligible for claim of deduction under Sec.80P(2)(d) of the Act. Accordingly, hold that the interest income earned by a cooperative society on its investments held with a cooperative bank would be eligible for claim of deduction under Sec.80P(2)(d) of the Act.

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