Dnyaneshwar More Bigarsheti Gramin Pat Puravatha Sahakari Sanstha Ltd. Vs ITO (ITAT Pune)
Assessee is a Cooperative Credit Society and engaged in the activity of accepting deposits from its members and providing credit facilities to them. The assessee filed return for AY 2017-18 declaring Nil income after claiming deduction under Chapter VIA at Rs.13,48,854/- while claiming business loss at Rs.3,56,511/-. Case was selected for scrutiny. AO noticed that the assessee earned interest income of Rs.17,05,365/- on investment with Cooperative Banks, which in his opinion does not quality for deduction u/s.80P(2)(d) which was disallowed by AO. CIT (A) upheld the disallowance made by the AO.
ITAT held that Section 80P(2)(d) provides that the sum received in respect of any income by way of interest or dividend derived by Cooperative Society from its investment with any other Cooperative Society, the whole of such income is eligible for deduction u/s.80P. Reliance was placed on the decision of Kolhapur District Central Co-op. Bank Kanista Sevakanchi Sahakar Pat Sanstha Ltd., Vs. ITO in ITA No.1365/PUN/2023, The Ugar Sugar Works Kamgar & Dr. Shirgaokar Shaikshanik Trust Nokar Co-op Credit Society vs. ITO in ITA No.84/PAN/2018. Considering the above decisions, order of CIT (A) was set-aside and Ao was directed to allow the claim.
