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TMI Blog2023 (11) TMI 245X X X X Extracts X X X X X X X X Extracts X X X X ..... bank partake of the business income which is eligible for deduction u/s 80P(2)(a)(i) Fact of existence of debate on the issue of taxability of the interest income earned on the deposits made with other co-operative banks or other banks proved. Therefore, in the light of the law settled in the case of Malabar Industrial Co. Ltd [ 2000 (2) TMI 10 - SUPREME COURT] the power of revision cannot be exercised by the ld. PCIT in exercising of power vested with him u/s 263 in respect of debatable issue. Even assuming for a moment, there is failure on the part of the Assessing Officer to examine the issue of taxability of interest earned on deposits made with co-operative banks or other banks, in our considered opinion, the power of revision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of the case are that the appellant is a Co-operative Society engaged in the business of providing credit facilities to its members. The Return of Income for the assessment year 2018-19 was filed on 05.10.2018 declaring total income of Rs. Nil. In the return of income, the assessee co-operative society had sought the exemption of income earned on deposits made with other co-operative banks or other banks made out of the surplus funds from tax u/s 80P(2)(a)(i)/80P(2)(d) of the Income Tax Act, 1961 ( the Act ). The said claim came to be allowed by the Assessing Officer while completing the assessment u/s 143(3) of the Act. 5. Subsequently, on review of the assessment records, the ld. PCIT was of the opinion that the interest income earned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der should be one that it is not debatable or plausible view. In a case where the Assessing Officer examined the claim took one of the plausible views, the assessment order cannot be termed as an erroneous . 8. Now, we proceed to examine the existence of fact of debate on the issue of exemption of interest income earned by the assessee co-operative society from other co-operative banks or other banks. There is a cleavage of judicial opinion among several High Courts on the issue of eligibility of this kind of income for exemption u/s. 80P(2)(a)(i) of the Act. The Hon ble Punjab Haryana High Court in the case of CIT vs. Punjab State Cooperative Federation of Housing Building Societies Ltd. 11 taxmann.com 448, the Hon ble Gujarat High C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i Sah. Pat Sanstha Maryadit Vs. ITO (ITA Nos.559/560/PUN/2018, dated 11-12-2018) taken view in favour of the assessee following the judgment of Hon ble Karnataka High Court in the case of Tumkur Merchants Souharda Credit Cooperative Ltd. (supra). Respectfully following the decision of the Coordinate Bench of this Tribunal, we are of the considered opinion that the interest income earned on fixed deposits with bank partake of the business income which is eligible for deduction u/s 80P(2)(a)(i) of the Act. 9. The above discussion clearly brings out the fact of existence of debate on the issue of taxability of the interest income earned on the deposits made with other co-operative banks or other banks. Therefore, in the light of the law set ..... X X X X Extracts X X X X X X X X Extracts X X X X
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