Belve Vyavasaya Seva Sahakari Sangha Ltd. Vs CIT (Karnataka High Court)
Summary: The Karnataka High Court considered an appeal under Section 260A of the Income-tax Act, 1961 filed by Belve Vyavasaya Seva Sahakari Sangha Ltd. for Assessment Year 2016–17 against the order dated 07.08.2024 of the Income Tax Appellate Tribunal, ‘C’ Bench, Bengaluru, in ITA No.819/Bang/2024. The assessee, a Society, had filed its return claiming deduction under Section 80P(2) of the I.T. Act. The return was selected for scrutiny and notice under Section 143(2) was issued.
The Assessing Officer noticed that the assessee had made deposits with the SCDCC Bank and other nationalised bank and earned interest thereon. The assessee claimed the interest income as deduction under Section 80P(2)(a)(i). The Assessing Officer held that the interest was assessable under the head “Income from Other Sources” and that the deduction was not allowable, further holding that the assessee was not entitled to deduction of such interest income under Section 80P(2)(a)(i) in view of Section 80P(2)(d). The assessment was completed under Section 143(3) by order dated 13.12.2018. The Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, dismissed the assessee’s appeal by order dated 01.03.2024.
The Tribunal, by order dated 07.08.2024, held that the interest income received from investments made with the SCDCC Bank and other nationalised bank was not eligible for deduction under Section 80P(2)(a)(i) in view of Section 80P(2)(d). The assessee thereafter approached the High Court.
