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2017 (4) TMI 1249 - AT - Income TaxDeduction u/s 80P(2)(a)(i) disallowed - interest income and dividend income derived by the assessee from its shareholding in other co-operative societies - the assessee falls under the category of ‘’Primary Co-operative Bank’’ as per definition in part V of the Banking Regulation Act, 1949 - Held that:- The facts being similar as in Quepem Urban Co-operative Credit Society [2015 (6) TMI 573 - BOMBAY HIGH COURT] wherein held Section 80P(1) of the Act restricts the benefits of deduction of income of Cooperative Society to the extent it is earned by providing credit facility to its members. Therefore, to the extent the income earned is attributable to dealings with the non-members are concerned, the benefit of section 80P of the Act would not be available. In the above view of the matter, at the time when effect has been given to the order of this Court, the authorities under Act would restrict the benefit of deduction u/s 80P of the Act only to the extent that the same is earned by the appellant in carrying on its business of providing credit facilities to its members. Thus hold that the assessee is entitled to the benefit of deduction available u/s 80P of the Act. However, as held in the above judgement to the extent the income earned is attributable to dealings with non-members are concerned the benefit of section 80P of the Act would not be available to the assessee. In view of the above, the AO is directed to verify the same and pass a consequential order, if any.
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