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2010 (1) TMI 851 - AT - Income TaxWhether assessee is entitled for deduction under section 80P(2)(a)(i) on the interest received under section 244A of the Act on the refund of tax. - Held that:- the purpose of allowing deduction under section 80P(2)(a)(i) to a co-operative society would be frustrated, if in peculiar circumstances, such as the one prevailing in the present case, the assessee is compelled to pay tax on its income, due to circumstances beyond its control. - In view of the fact that the expression 'attributable to' has been used in section 80P visa-vis the 'business of the banking', we have absolutely no doubt in our mind that such interest is attributable to the banking business and there cannot be any question of denial of deduction under section 80P on such interest. - interest has been awarded on the refund of income-tax which was paid in relation to income from banking business otherwise eligible for deduction under section 80P(2)(a)(i). - Deduction allowed.
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