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TMI Blog2024 (1) TMI 851X X X X Extracts X X X X X X X X Extracts X X X X ..... or the assessee, stands considered in Peroorkkada Service Co-operative Bank Ltd. [ 2021 (12) TMI 1084 - KERALA HIGH COURT] The entire premise of the decision in Totgars Co-operative Sales Society(supra), is whether the income arising to a society on it s deposits with other co-operative society/bank arises to it in the normal course of business or is on it s surplus funds for the time being. The Apex Court found it to be latter, so that the income was not assessable u/s 28, i.e., as business income, but only as income from other sources, as was by the Revenue u/s. 56. The issue of the same being, in the alternative, deductible u/s.80P(2)(d) of the Act did not come up for consideration before it. Even if, therefore, as the Revenue co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 05.2021. The assessee has also filed a Stay Application qua the outstanding demand arising in pursuance of the impugned assessment. 2. The only issue in appeal is the non-grant of deduction u/s. 80P(2)(a)(i) of the Act on interest and dividend incomes received by the assessee, a primary agricultural credit society under the Kerala Co-operative Societies Act, 1969 (Kerala Act) from Ernakulam District Co-operative Bank, at Rs. 47,75,444 and Rs. 2,25,000 respectively, assessing the same, at a total of Rs. 50,00,444, as income from other sources u/s. 56 of the Act. 3. Before us, the assessee s case was of the same being in any case deductible u/s. 80P(2)(d) of the Act, as held by the Hon'ble jurisdictional High Court in Pr. CIT vs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... qualify for deduction under the relevant clause of section 80P of the Act. The matter has been explained by the Cochin Bench per it s decisions in Mundakkayam SCB Ltd. v. ITO (ITA No. 73/Coch/2023, dated 28.12.2023) and ITO v. The Adichanalloor Farmers SCB Ltd. Ors . (ITA No. 134/Coch/2019 Ors., dated 31.08.2023), also expressing it s view in its respect, even as the decision in Peroorkkada Service Co-operative Bank Ltd . (supra) would in any case hold. The impugned sum of Rs. 50,00,444 would accordingly stand to be deducted u/s.80P(2)(d) of the Act. We decide accordingly, and the assessee succeeds. 5. In the result, the assessee s appeal is allowed and the stay application is dismissed as infructuous. Order pronounced on Jan ..... X X X X Extracts X X X X X X X X Extracts X X X X
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