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2018 (8) TMI 2060 - AT - Income TaxDeduction u/s. 80P(2)(a)(i) - Whether the interest earned on investment made with sub-treasury and Banks is entitled for deduction u/s. 80P(2)(a)(i)? - HELD THAT:- Admittedly, the assessee is a primary agricultural credit society registered under the Kerala Cooperative Societies Act, 1969. The Hon'ble High Court of Kerala in the case of Chirakkal Service Co-op Bank Ltd.[2016 (4) TMI 826 - KERALA HIGH COURT] had held that a primary agricultural credit society, registered under the Kerala Cooperative Societies Act, 1969 is entitled to the benefit of deduction u/s. 80P(2) - Thus we hold that the assessee-Society is entitled to the benefit of deduction u/s. 80P(2) of the Act. Whether the assessee was entitled to deduction u/s 80P(2)(a)(i) of the I.T. Act for the interest received on investment made with sub-treasuries and banks? - As relying on Padne Service Co-operative Bank Limited [2018 (1) TMI 602 - ITAT COCHIN] Interest earned from investment with sub-treasuries and Banks was part of the banking activities, and therefore, the said income was entitled to deduction u/s 80P(2)(a)(i) of the I.T. Act. Hence, we hold that the CIT(A) is justified in directing the A.O. to grant deduction u/s 80P(2)(a)(i) of the I.T. Act for the interest earned on the investments made with sub-treasuries and Banks. Appeal filed by the Revenue is dismissed.
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