2023 (4) TMI 1109 - AT - Income Tax

Disallowance of deduction u/s 80(P)(2)(d) - interest and dividend income earned from other cooperative societies - HELD THAT - This component of income is allowable for deduction u/s 80P(2)(d) of the Act and this issue is covered by a series of decisions of Division Bench of this Tribunal as well as by the decision of Hon'ble Jurisdictional High Court. AO is directed to verify the interest and dividend income if earned from cooperative society, the assessee be allowed full relief to the assessee. Deduction u/s 80(P)(2)(a)(iv) - Complete bifurcation is not discernable from the various documents filed by the ld. AR of the assessee, though, the assessee in its computation of income has mentioned the figure, therefore, this issue is also restored back to the file of AO to verify the fact and pass the order in accordance with law. Assessee is also directed to furnish complete details of such deduction with its bifurcations. AO shall grant reasonable and fair opportunity of hearing to the assessee. The assessee is also directed to provide complete details and evidences on this issue to the Assessing officer. The grounds raised by the assessee in this appeal is allowed for statistical purposes.

Summary

Issues involved:
The appeal is against the order of National Faceless Appeal Centre regarding the disallowance of deduction under Section 80(P)(2)(a)(iv) and 80(P)(2)(d) of the Income Tax Act for the Assessment Year 2019-20.

Deduction under Section 80(P)(2)(d):
The assessee, a cooperative society, claimed deduction of Rs. 96,371 received as dividend or interest income from other cooperative societies. The lower authorities disallowed this deduction without proper verification. The Tribunal directed the Assessing Officer to verify this income and allow the deduction as it is covered by previous decisions.

Deduction under Section 80(P)(2)(a)(iv):
The assessee also claimed a deduction of Rs. 7,18,939 received from its members under Section 80(P)(2)(a)(iv). However, the complete bifurcation of this amount was not clear from the documents submitted. The Tribunal instructed the Assessing Officer to examine this issue, requesting the assessee to provide detailed evidence and bifurcation. The Assessing Officer was directed to grant a fair opportunity of hearing before making a decision.

Conclusion:
The appeal of the assessee was allowed for statistical purposes, with directions given to the Assessing Officer to verify and allow the deductions under Section 80(P)(2)(d) and Section 80(P)(2)(a)(iv) after proper examination of the relevant income and documentation.