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TMI Blog2024 (4) TMI 795X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee against the appellate order passed by the National faceless appeal Centre, Delhi (the learned CIT - A) for assessment year 2013 - 14 dated 16/8/2023 wherein the appeal filed by the assessee against the assessment order dated 17/12/2019 passed under section 143 (3) read with section 147 of the income tax act, 1961 (the act) by ACIT Circle 23 (1), Mumbai (the AO), was dismissed. 03. Assessee raised following grounds of appeal: - "1. On the given facts, circumstances and judicial pronouncements, CIT (Appeals) erred in confirming the action AO in denying deduction of u/s 80P of Rs. 81,48,348/- as claimed by the assessee while filing the Return of Income for A.Y. 2017-18. Such action of CIT (A) to deny the deduction u/s 80P is bad i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under 80P(2)(c) of Rs. 50,000/- thus the aggregate deduction was claimed under section 80 P of Rs. 7,645,872/-. 07. The claim of the assessee is that assessee is a co-operative society registered under the Maharashtra cooperative societies act, 1960 and interest received by the appellant from the cooperative banks which are registered under the cooperative society act is deductible under section 80P(2)(d). 08. However, the learned AO did not agree with the assessee and disallowed the above deduction. 09. On identical facts and circumstances, the disallowance was made for assessment year 2014 - 15 and 2015 - 16. For both the above years the learned CIT - A has decided the issue in favour of the assessee. 010. However, the learned assessi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s claimed deduction under section 80P(2)(d) of the act for bank interest received from cooperative banks and nationalized Bank amounting to Rs. 8,148,348/- and other income of Rs. 50,000. 013. The learned assessing officer on the same grounds held that assessee is not eligible for deduction under section 80P(2)(d) of the act for Rs. 8,148,348. The same was disallowed and assessment order was passed under section 143 (3) of the act on 7/12/2019. The assessee challenged the same before the learned CIT - A who passed an order on 16/8/2023 on similar lines and dismissed the appeal of the assessee. Therefore, assessee is in appeal. 014. The only issue in both these appeal is whether the assessee is entitled to deduction of interest income rece ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce with and subject to the provisions of the section in computing the total income of the assessee. According to subsection (2) in case of a co-operative society engaged in carrying on the business of banking or providing credit facilities to its member is eligible for deduction of the whole of the amount of profits and gains of business attributable to anyone or more of such activities. The claim of the revenue authorities is that the amount of interest earned by this entity is not the business income of the assessee and therefore, the interest income does not fall into the amount of profits and gains of business attributable to the activities of the society. Therefore the deduction under section 80P(2)(a) of the act is denied. However, we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the business of the assessee and therefore the claim of the assessee fails under section 80P(2)(a) of the act, but the claim is still allowable and therefore cannot be denied under section 80P(2)(d) of the act. This issue is also covered in favour of the assessee by the decision of the honourable Supreme Court in case of Kerala State Co-Operative Agricultural & Rural Development Bank Ltd. [2023] 154 taxmann.com 305 (SC)/where the deduction was allowable to the state level agricultural and rural development bank, was engaged in providing credit facility to its members . The case of the assessee is on far better footings that these are society of only the employees of Indian oil Corporation. In view of the above facts, we direct the learned ..... X X X X Extracts X X X X X X X X Extracts X X X X
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