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2021 (3) TMI 263 - AT - Income TaxDisallowance u/s 80P(2)(a)(i) - sole reason for the A.O. and the first appellate authority to decide the appeal against the assessee was that the assessee was registered under the Karnataka Souharda Sahakari Act, 1997, and therefore, was not a cooperative society within the purview of section 2(19) - HELD THAT:- Hon’ble Karnataka High Court in the case of M/s.Swabhimani Souharda Credit Co-operative Ltd.[2020 (1) TMI 831 - KARNATAKA HIGH COURT]had decided an identical issue and held that the entities registered under the Karnataka Souharda Sahakari Act, 1997, fit into the definite term “Co-operative Society”. AO in the impugned assessment order had clearly held that the assessee is providing credit facilities to its members and interest paid to members on their deposits. As further stated by the A.O. that the entire interest income received is out of operational income of the assessee. As mentioned earlier, the solitary reason for denying the claim of deduction u/s 80P(2) was that the assessee cannot be termed as a cooperative society coming within the definition of section 2(19) since it is registered under the Karnataka Souharda Sahakari Act, 1997. Since have held in view of the above judicial pronouncement that the assessee is a cooperative society though it is registered under the Karnataka Souharda Sahakari Act, 1997, allow the appeal of the assessee.
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