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2021 (4) TMI 806 - AT - Income TaxDeduction u/s 80P(2)(a) - assessee has earned interest from surplus funds, which are not required immediately for business purposes and were invested in short term deposits and securities - As held that such an interest is not attributable to the business of the assessee in carrying on the business of providing credit facilities to its members or marketing of the agricultural produce of its members and is therefore, assessable as income from other sources and not as its business profit. Observing that the deduction u/s 80P(2)(a) is allowable only from its business income and not from income from other sources - HELD THAT:- This issue of interest income being business income or income from other sources was considered by various Benches of the Tribunal and also the jurisdictional High Court wherein the jurisdictional High Court has distinguished the decision of the Hon'ble Supreme Court in the case of Totgar’s Cooperative Sale Society vs. ITO [2010 (2) TMI 3 - SUPREME COURT] that the facts of the case before them and have held that the interest income from fixed deposits made out of surplus funds available with the assessee is also attributable to the business of the assessee and is accordingly allowable as a deduction u/s 80P of the Act As relying on THE VAVVERU CO-OPERATIVE RURAL BANK LTD. VERSUS THE CHIEF COMMISSIONER OF INCOME TAX, VIJAYAWADA [2017 (4) TMI 663 - ANDHRA PRADESH HIGH COURT] the appeal of the assessee is allowed.
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