2015 (6) TMI 1270 - AT - Income Tax

Deduction u/s 80P(2)(d) - interest earned from Banks, Post Office and on FDRs - CIT(A) allowed claim - HELD THAT - This issue as examined by the Tribunal in the case of Zila Ganna Utpadak Sahkari Samiti Ltd., Hardoi and Income Tax Officer, Hardoi vs. Sahkari Ganna Vikas Samiti Ltd., Hardoi 2014 (11) TMI 1286 - ITAT LUCKNOW and the ld. CIT (A) has followed the said orders while holding that deduction under section 80P of the Act is allowable to the assessee on the interest on FDRs from banks and post office. Copies of the orders of the Tribunal are placed on record. Since the ld. CIT (A) has adjudicated the issue following the order of the Tribunal in the aforesaid cases, we find no infirmity in his order. We accordingly confirm the order of the ld. CIT(A). Appeal of the Revenue stands dismissed.

Summary

Issues:
1. Allowability of deduction under section 80P of the Income Tax Act on interest earned from Banks, Post Office, and FDRs.
2. Admissibility of the deduction following relevant judicial decisions.

Analysis:

Issue 1: Allowability of deduction under section 80P:
The appeal was filed by the Revenue against the order of the ld. CIT(A) regarding the deletion of the addition made by the Assessing Officer as interest earned from Banks, Post Office, and on FDRs. The Revenue contended that the deduction claimed by the assessee under section 80P(2)(d) of the Income Tax Act, 1961 was not admissible. The Tribunal noted that the ld. CIT(A) followed previous Tribunal orders allowing the deduction under section 80P for interest on FDRs and post office deposits. The Tribunal referred to specific cases where similar views were upheld. The Tribunal found no infirmity in the ld. CIT(A)'s order and confirmed the allowance of the deduction under section 80P.

Issue 2: Admissibility of the deduction following judicial decisions:
During the hearing, the assessee's counsel highlighted the Tribunal's previous decisions supporting the deduction under section 80P for interest income. The Tribunal acknowledged the relevance of these decisions and upheld the allowance of the deduction based on the judicial precedents cited. The Revenue, represented by the ld. D.R., relied on the Assessing Officer's order, which was contrary to the Tribunal's interpretation. However, after examining the orders of the lower authorities and considering the submissions, the Tribunal found that the ld. CIT(A) correctly followed the Tribunal's previous decisions and upheld the allowance of the deduction. Consequently, the appeal of the Revenue was dismissed, affirming the order of the ld. CIT(A).

In conclusion, the Tribunal upheld the allowance of the deduction under section 80P for interest earned from Banks, Post Office, and FDRs, based on consistent judicial interpretations and precedents. The decision was in favor of the assessee, confirming the order of the ld. CIT(A) and dismissing the Revenue's appeal.