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TMI Blog2023 (2) TMI 1017X X X X Extracts X X X X X X X X Extracts X X X X ..... Revenue : Shri A.N. Bhalekar, D.R. ORDER PER : KULDIP SINGH, JUDICIAL MEMBER: The appellant, M/s. Golden Gulshan Co-operative Housing Society Ltd. (hereinafter referred to as the assessee ) by filing the present appeal, sought to set aside the impugned order dated 12.10.2022 passed by the National Faceless Appeal Centre(NFAC) [Commissioner of Income Tax (Appeals), Delhi] (hereinafter referred to as CIT(A)] qua the assessment year 2020-21 on the grounds inter-alia that :- 1. On the facts and circumstances of the case, CIT(A) erred in not rectifying and at the same time confirming the additions made by way of disallowance of deduction claimed u/s.80P(2)(d) of Rs.5,04,021 of the act. 2. On the facts and circumstances of the case and in law, the appellant has made correct claim in the return of Income in respect of Section 80P(2)(d) deduction and therefore the adjustment was wrongly made by the CPC. The CPC had no power to make an adjustment other than the adjustment provided specifically under Section 143(1) of the act. The AO exercised the power beyond his jurisdiction and the CIT(A) wrongly confirmed the same. 3. On the facts and circumstances of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Hon ble Supreme Court in case of Totgars Co-operative Sale Society Ltd. (supra). 6. Undisputedly the assessee society had invested its surplus fund with cooperative bank and had earned the interest income of Rs.5,04,021/-. 7. The co-ordinate Bench of the Tribunal in case of Palm Court M Premises Co-operative Society Ltd. (supra) decided the issue in favour of the assessee by distinguishing the judgment rendered by Hon ble Supreme Court in case of Totgar s Co-operative Sale Society Ltd. (supra) and by discussing the decision rendered by Hon ble Bombay High Court and Hon ble Gujarat High Court wherein it is held that interest income earned by the Co-operative Society on its investment made with co-operative bank would be eligible for claim of deduction under section 80P(2)(d) of the Act by returning following findings: 8. We have given a thoughtful consideration to the contentions advanced by the ld. Authorized representatives for both the parties in context of the aforesaid issue under consideration. As stated by the ld. A.R, and rightly so, the issue that interest received by a co-operative society on its deposits with co-operative banks would be eligible for ded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, we find, that he was of the view that pursuant to insertion of sub-section (4) of Sec. 80P, the assessee would no more be entitled for claim of deduction under Sec. 80P(2)(d) in respect of the interest income that was earned on the amounts which were parked as investments/deposits with co-operative banks, other than a Primary Agricultural Credit Society or a Primary Co-operative Agricultural and Rural Development Bank. Observing, that the co-operative banks from where the assessee was in receipt of interest income were not co-operative societies, the Pr. CIT was of the view that the interest income earned on such investments/deposits would not be eligible for deduction under Sec. 80P(2)(d) of the Act. 7. After necessary deliberations, we are unable to persuade ourselves to be in agreement with the view taken by the Pr. CIT. Before proceeding any further, we may herein reproduce the relevant extract of the aforesaid statutory provision, viz. Sec. 80P(2)(d), as the same would have a strong bearing on the adjudication of the issue before us. 80P(2)(d) (1). Where in the case of an assessee being a co-operative society, the gross total income includes any income referred to in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 of 1912), or under any other law for the time being in force in any state for the registration of co-operative societies; We are of the considered view, that though the co-operative banks pursuant to the insertion of subsection (4) to Sec. 80P would no more be entitled for claim of deduction under Sec. 80P of the Act, but as a co-operative bank continues to be a co-operative society registered under the Co-operative Societies Act, 1912 (2 of 1912), or under any other law for the time being in force in any State for the registration of co-operative societies, therefore, the interest income derived by a cooperative society from its investments held with a co-operative bank would be entitled for claim of deduction under Sec.80P(2)(d) of the Act. 8. We shall now advert to the judicial pronouncements that have been relied upon by the ld. A.R. We find that the issue that a cooperative society would be entitled for claim of deduction under Sec. 80P(2)(d) on the interest income derived from its investments held with a co-operative bank is covered in favour of the assessee in the following cases: (i) Land and Cooperative Housing Society Ltd. Vs. ITO (2017) 46 CCH 52 (Mum) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n its investments held with a cooperative bank would be eligible for claim of deduction under Sec.80P(2)(d) of the Act. We find that as held by the Hon'ble High Court of Bombay in the case of K. Subramanian and Anr. Vs. Siemens India Ltd. and Anr (1985) 156 ITR 11 (Bom), where there is a conflict between the decisions of non-jurisdictional High Court s, then a view which is in favour of the assessee is to be preferred as against that taken against him. Accordingly, taking support from the aforesaid judicial pronouncement of the Hon ble High Court of jurisdiction, we respectfully follow the view taken by the Hon'ble High Court of Karnataka in the case of Pr. Commissioner of Income Tax and Anr. Vs. Totagars Cooperative Sale Society (2017) 392 ITR 74 (Karn) and Hon ble High Court of Gujarat in the case of State Bank Of India Vs. CIT (2016) 389 ITR 578 (Guj), wherein it was observed that the interest income earned by a cooperative society on its investments held with a cooperative bank would be eligible for claim of deduction under Sec.80P(2)(d) of the Act. 9. Be that as it may, in our considered view, as the A.O while framing the assessment had taken a possible view, and t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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