The Tax Publishers2021 TaxPub(DT) 0011 (Mum-Trib)

INCOME TAX ACT, 1961

Section 80P(2)

High Court in the case of PCIT vs. Totagars Co-operative Sale Society [(2017) 395 ITR 611 (Karnataka) : 2017 TaxPub(DT) 1748 (Karn-HC)], held that interest income earned from deposit with the cooperative bank does not qualify for deduction under section 80P(2)(d), therefore, following the same decision, the deduction claimed by the assessee under section 80P(2)(d) in respect of interest derived from investments with the cooperative banks was allowed.

Deduction under section 80P(2) - Allowability - Interest received on deposit kept with co-operative bank -

Assessee was engaged in the business of accepting deposits and lending money to its members and made investments in the Co-operative bank in the form of fixed deposits and earned interest income on the said investments. Assessee claimed deduction under section 80P(2)(a)(i). AO disallowed assessee's claim of deduction under section 80P(2)(a)(i) and also under section 80P(2)(d) in respect of interest income on fix deposits with Co-operative Banks. Held: In the case of PCIT vs. Totagars Co-operative Sale Society [(2017) 395 ITR 611 (Karnataka) : 2017 TaxPub(DT) 1748 (Karn-HC)] it was held that interest income earned from deposit with the cooperative bank does not qualify for deduction under section 80P(2)(d). No judgement from High court on the issue of eligibility of deduction under section 80P(2)(d) on interest income derived by a Cooperative Society from a Cooperative Bank was brought to notice. Following the decision of High Court in the case of Totagars Cooperative Sale Society (supra), the deduction claimed by the assessee under section 80P(2)(d) in respect of interest derived from investments with the cooperative banks was allowed.

Followed:M/s. The Totgars´ Cooperative Sale Society Limited v. ITO 2010 TaxPub(DT) 1466 (SC) The Pr. CIT v. Totagars Co-Operative Sale Society (2017) 395 ITR 611 (Karnataka) : 2017 TaxPub(DT) 1748 (Karn-HC) The Pr. CIT v. Totagars Co-operative Sale Society, (2017) 392 ITR 74 (Karn) : 2017 TaxPub(DT) 0677 (Karn-HC) The Surat Vankar Sahakari Sangh Ltd. v. ACIT (2016) 421 ITR 134 (Guj) : 2016 TaxPub(DT) 3733 (Guj-HC) State Bank of India (SBI) v. CIT 2016 TaxPub(DT) 3564 (Guj-HC) Kaliandas Udyog Bhavan Premises Co-op Society Ltd. v. ITO (2018) 94 taxmann.com 15 (Mumbai) : 2018 TaxPub(DT) 3128 (Mum-Trib) Merwanjee Cama Park Co-op Housing society Ltd. v. ITO 2018 TaxPub(DT) 1580 (Mum-Trib) M/s. Sea Grean Go-operative Housing Society Ltd. v. ITO [ITA No.1343/MUM/2017, dt. 31-3-2017] M/s Vaibhav Cooperative Credit Society v. ITO [I.T.A. No. 5819, 5217/Mum/2014 (Assessment Year: 2010-11), dt. 17-3-2017] Lands End Co-operative Housing Society Ltd v. I.T.O. 2016 TaxPub(DT) 2383 (Mum-Trib). Relied:Saidatta Coop-. Credit Society Ltd. v. ITO [ITA No.2379/Mum/2015, dt. 15-1-2016]. Distinguished:K. Subramanian & Anr. v. Siemens India Limited & Another (1985) 156 ITR 11 (Bom) : 1985 TaxPub(DT) 0158 (Bom-HC).

REFERRED :

FAVOUR : In assessee's favour

A.Y. : 2012-13



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