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2021 (6) TMI 503 - AT - Income TaxDeduction u/s 80P(2)(a)(i) - AO disallowed the claim on the ground that the assessee is not engaged in the business of banking, is not providing credit facility to its members and also on the ground that interest was earned on surplus funds - Since the assessee earned incomes on the investments made from cooperative sector, the AO had calculated the proportionate incomes earned from cooperative banks - CIT(A) disallowed the assessee’s claim of deduction u/s 80P(2)(a)(i) and allowed the deduction claimed u/s 80P(2)(d) - HELD THAT:- We observe that the CIT(A) confirmed the AO’s decision in respect of claim of deduction u/s 80P(2)(a)(i) relying on the judgment of the Hon’ble Supreme Court in the case of Citizen Cooperative Society Ltd., [2017 (8) TMI 536 - SUPREME COURT] the decision of which was followed by the AO while confirming the disallowance. As regards the assessee’s claim of deduction u/s 80P(2)(d) of the Act, the CIT(A) relying on the decision of the coordinate bench of this Tribunal in assessee’s own case [2015 (3) TMI 317 - ITAT HYDERABAD] directed the AO to delete the disallowance made under the said section. On perusal of the orders of authorities below, we observe from the order of the Assessing Officer that various allegations have been made by the AO regarding the activity of the assessee , without obtaining licence from RBI the assessee carrying out the banking business activity, giving loan to Members and to others and kinds of Members etc which is clear from the assessment order. It is interesting to note here that both the authorities below alleged that the assessee is providing loans to others, but , it is clear from the order of the CIT(A) at para No. 4.3 of his order, the assessee has given loans to only shareholder members. The issue of deduction claimed U/s 80P(2)(d) has been decided by the coordinate bench of Tribunal in assessee’s own case as cited supra and in which the decision of Hon’ble Supreme Court Totgars Cooperative Sales Society Ltd. [2010 (2) TMI 3 - SUPREME COURT] has been discussed. TDS u/s 194A - Addition u/s 40(a)(ia) - HELD THAT:- Issue is covered by section 194A(3)(v) in assessee’s favour being a payment made by society to its members. This disallowance is deleted.
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