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2018 (5) TMI 1729 - AT - Income TaxDisallowance u/s 80P - Whether the income from interest earned on Bank FDRs is eligible for deduction u/s 80P - Held that:- The interest income earned by the assessee from its members on account of advance given to them is allowable for deduction u/s 80P(2)(a)(i) of the Act Interest income earned by the assessee from the short term deposits made with the State Bank of India is not eligible for deduction u/s 80P(2)(a)(i) as followed in the case of STATE BANK OF INDIA (SBI) VERSUS COMMISSIONER OF INCOME TAX [2016 (7) TMI 516 - GUJARAT HIGH COURT] - Assessee is entitled to claim the deduction of the expenditure incurred by it in connection with such interest income. Therefore, we direct the AO to take the net interest income for the purpose of disallowance of deduction u/s 80P(2)(a)(i) of the Act. Disallowance of interest on deposits made with other cooperative banks - Held that:- Assessee is eligible for such deduction u/s 80P(2)(d) - Decided in favor of assessee. Disallowance of income from other sources - Held that:- Assessee is not entitled for deduction in respect of such income in view of Judgment of MAFATLAL INDUSTRIES LTD'S EMPLOYEES CO-OPERATIVE CREDIT SOCIETY LTD VERSUS THE INCOME TAX OFFICER [2014 (2) TMI 516 - ITAT AHMEDABAD] - Decided against the assessee
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