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TMI Blog2017 (3) TMI 1610X X X X Extracts X X X X X X X X Extracts X X X X ..... 28 - SUPREME COURT OF INDIA], as correct for cooperative societies /banks claiming deduction u/s. 80P(2)(a)(i) of the Act. In other words, the Board has taken a view that interest earnings of a cooperative society which was having as its primary business, providing credit facilities to its members who were agriculturists, could be considered under the head income from business and not from income from other sources. We are of the opinion that assessee has to succeed in this appeal. Interest earned by the assessee from its deposits placed in Sub-Treasury and banks are eligible for deduction u/s. 80P(2)(a)(i) of the Act. See Kizathadiyoor Service Cooperative Bank Ltd vs. ITO [2016 (7) TMI 1405 - ITAT COCHIN] - Decided in favour of assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... ated 02.11.2015 is sufficient enough to answer the issues raised in relation to 'income from other sources' and 'profits and gains of business' as covered by questions of law 'B' and 'C'. Having bestowed our anxious consideration to the submissions of the learned counsel for the appellants vis-à-vis the submissions of the learned Senior standing counsel for the Department, who said that all the issues appear to be intricately connected inasmuch as the questions under Section 80P can also be considered only in the light of the question whether interest derived by the society is income from other sources, we are of the view that it is necessary that the Tribunal re-considers all the issues arising for decision in these ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing company could be considered only under the head ''income from other sources''. 4. We have considered the rival contentions and perused the orders of the authorities below. Hon'ble Jurisdictional High Court had remitted the appeal back to us with a clear direction to consider circular No.18/2015, dated 02.11.2015 and judgment of their lordship in the case of Chirakkal Service Co-operative Bank Ltd. vs. CIT 384 ITR 490. Circular No.18/2015, dated 02.11.2015 is reproduced hereunder:- ''Subject : Interest from Non-SLR securities of Banks-reg. It has been brought to the notice of the Board that in the case of Banks, field officers are taking a view that, "expenses relatable to investment in non-SLR securities need to be disallowed under s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that for application of Sec. 80P(2)(a)(i) of the Act assessee was considered as a primary agricultural credit society based on certificate issued by Joint Registrar, Kottayam. In our opinion para 3.2 of the circular reproduced above has accepted the judgment of Hon'ble Apex Court in the case of CIT vs. Nawanshahar Central Cooperative Bank Ltd 289 ITR 6, as correct for cooperative societies /banks claiming deduction u/s. 80P(2)(a)(i) of the Act. In other words, the Board has taken a view that interest earnings of a cooperative society which was having as its primary business, providing credit facilities to its members who were agriculturists, could be considered under the head income from business and not from income from other sources. Simi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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