TMI Blog2023 (2) TMI 917X X X X Extracts X X X X X X X X Extracts X X X X ..... l Member For the Assessee : Shri M R Bhagwat For the Respondent : Shri Keyur Patel, CIT ORDER PER PARTHA SARATHI CHAUDHURY, JM : This appeal preferred by the assessee emanates from the order of the ld. Principal Commissioner of Income Tax, Pune-4, dated 30-03-2022 for the Assessment Year 2017-18 as per the grounds of appeal appearing hereinafter. The grounds of appeal are as follows: 1) The learned PCIT erred in initiating action u/s 263 of the Income Tax Act even though the assessing officer's assessment order under sec 143 (3) was neither erroneous nor prejudicial to the interests of revenue 2) The learned PCIT erred in not properly appreciating the facts of the case and ignoring settled judicial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r claiming deduction of Rs.6,32,86,382/- under the provisions of section 80P of the Income Tax Act, 1961 ( the Act ). Against the said return of income, the assessment was completed by the Assessing Officer accepting the returned income vide order dated 19.11.2019 passed u/s 143(3) of the Act. 4. Subsequently, on examination of the assessment order, the ld. PCIT formed an opinion that failure the Assessing Officer to examine the taxability of interest earned on the investments made with the cooperative banks, as the same constitutes business income, rendered the assessment order erroneous. Accordingly, the ld. PCIT issued a show cause notice dated 08.03.2022 u/s 263 calling upon the appellant society to explain as to why the assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IT set aside the assessment order with a direction to examine the assessee s claim of deduction u/s 80P(2)(a)(i) as well as interest of Rs.19,88,77,712/- u/s 80P(2)(d) after affording reasonable opportunity of being heard to the appellant. 6. Being aggrieved, the appellant is in appeal before us in the present appeal. 7. The ld. AR submits that the issue of eligibility of income earned on the investment made with the cooperative bank was examined by the Co-ordinate Bench of this Tribunal in the case of M/s. Jan Kalyan Nagri Sahakari Pat. Limited Sanstha in ITA No.825/PUN/2019 for A.Y. 2014-15 order dated 26.08.2022. The ld. AR submits that the issue is covered in favour of the appellant. In support of this proposition, ld. AR reli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in this regard can be made to the decision of the Hon ble Supreme Court in the case of Malabar Industrial Co. Ltd. vs. CIT, 243 ITR 83 (SC) and in the case of CIT vs. Max India Ltd., 295 ITR 282 (SC). The error in the assessment order 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 . In the present case, we find that admittedly the interest income was earned from the cooperative banks, the cooperative bank is also a specie of cooperative society, therefore, the interest income earned by the cooperative society from the cooperative banks qualifies for deduction u/s 80(P)(2)(d) of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IT 50 taxmann.com 278, the Hon ble Punjab Haryana High Court in the case of CIT Vs. Punjab State Cooperative Agricultural Development Bank Ltd. 389 ITR 68 and the Hon ble Kolkata High Court in the case of CIT Vs. Southern Eastern Employees Cooperative Credit Society Ltd. 390 ITR 524 took a view that the income arising on the surplus invested in short term deposits and securities cannot be attributed to the activities of the society and, therefore, not eligible for exemption u/s.80P(2)(a)(i) of the Act. However, the Hon ble Karnataka High Court in the case of Tumkur Merchants Souharda Credit Cooperative Ltd. Vs. ITO (2015) 230 taxmann 309 (Kar.) and the Hon ble Telangana and Hon ble Andhra Pradesh High Court in the case of Vaveru Co-operat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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