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2019 (8) TMI 1878 - AT - Income TaxDeduction u/s. 80P - interest income on deposits with non co-operative bank - HELD THAT:- As decided in own case [2018 (3) TMI 1562 - ITAT PUNE] assessee before us, in line with statutory obligation of maintaining its status of Co-operative society and as per the regulations of Maharashtra State Co-operative Societies Act, was duty bound to transfer 25% of its profits to reserve funds, which it has done. There is no dispute to the same. For utilization of funds in reserve funds by way of making FDRs with Scheduled bank u/s 70 of the said Act. The assessee has received permission of the Registrar of Maharashtra Co-operative Societies Act to make such investment with Bank of Maharashtra and also in order to carry on the business activities of providing credit facilities to its employees, it is mandatory upon the assessee to invest 25% of its profits in the reserve funds, which in turn, are parked in FDRs with Bank of Maharashtra, then interest income earned by the assessee is from carrying on its business activities. Once it is so, then the said income is assessable as ‘Income from business’ and the assessee is entitled to claim deduction under section 80P(2)(a)(i) - Decided in favour of assessee.
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