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2023 (2) TMI 512 - AT - Income TaxDeduction u/s 80P - interest income earned from various co-operative banks - HELD THAT - We find that the grounds of appeal raised by assessee is squarely covered by the decision of Division Bench of this Tribunal in a series of decisions, including the decision in Bardoli Vibhag Gram Vikas Co.Op. Credit Society Ltd. 2016 (7) TMI 1217 - GUJARAT HIGH COURT wherein the assessee-cooperative society is held eligible for deduction under section 80P(2)(d) in respect of gross interest received from co-operative bank without adjusting interest paid to said bank, we conclude that the order passed by assessing officer is not erroneous. Hence, the grounds of appeal raised by assessee are allowed - We direct the Assessing Officer to allow deduction u/s 80P(2)(d) - In the result, the grounds of appeal raised by the assessee are allowed.
Issues:
1. Entitlement to deduction under Section 80P of the Income Tax Act for a cooperative credit society. Detailed Analysis: Issue 1: Entitlement to deduction under Section 80P of the Income Tax Act for a cooperative credit society The appeal was filed by the assessee against the order of the Commissioner of Income Tax (Appeals) concerning the entitlement to deduction under Section 80P of the Income Tax Act for the Assessment Year 2017-18. The assessee claimed that the interest income earned from cooperative banks, which are primarily cooperative societies, is exempt under Section 80P(2)(d) of the Act. The Assessing Officer disallowed the deduction based on a Karnataka High Court decision, treating the interest income as taxable. The Commissioner of Income Tax (Appeals) upheld the Assessing Officer's decision. The assessee relied on various case laws and argued that similar deductions were allowed in previous years. The Tribunal considered the submissions and case laws presented. It noted that the Assessing Officer had made inquiries and passed the assessment order, taking a reasonable view. The Tribunal referred to decisions of different High Courts and Tribunals supporting the assessee's position. It concluded that the order passed by the Assessing Officer was not erroneous, and the grounds of appeal raised by the assessee were allowed. The Tribunal directed the Assessing Officer to allow the deduction under Section 80P(2)(d) for the assessee, thereby allowing the appeal. This detailed analysis provides a comprehensive overview of the judgment, highlighting the legal arguments, case laws cited, decisions of the lower authorities, and the Tribunal's final decision in favor of the assessee regarding the entitlement to deduction under Section 80P of the Income Tax Act for a cooperative credit society.
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