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2022 (4) TMI 494 - AT - Income TaxDeduction u/s 80P(2)(a)(i) - interest income as received by the assessee on the surplus deposited with BDCC Bank Ltd. and also investments of statutory reserve funds - HELD THAT:- On perusal of provisions of section 80P(2)(d), it is clear that the income derived by a cooperative society from its investment held with other cooperative societies shall be exempt from the total income of a cooperative society. Therefore, what is relevant for claiming of deduction u/s 80P(2)(d) is that interest income should have been derived from the investment made by the assessee cooperative society with any other cooperative society. In the present case, the reasoning given by the lower authorities for denial of exemption u/s 80P(2)(d) is that interest was received from cooperative bank has no legs to stand as a cooperative bank is also a cooperative society. This issue was considered in the case of CIT vs. Totagars Cooperative Sale Society [2017 (1) TMI 1100 - KARNATAKA HIGH COURT] as referring to case of Totgars Co-operative Sales Society Ltd. [2010 (2) TMI 3 - SUPREME COURT] held that the ratio of decision of the Hon’ble Supreme Court in the aforesaid case (supra) not to be applicable in respect of interest income on investment as same falls under the provisions of section 80P(2)(d) and not u/s 80P(2)(a)(i) of the Act. As from material on record it is not clear that whether the entire interest income was received from cooperative bank or other bank? - In the circumstances, we remit the matter to the file of the Assessing Officer for the purpose of verifying whether entire interest income of ₹ 8,19,601/- was received from other co-operative bank, if so, allow the same or otherwise restricted the exemption to the extent of income received from other cooperative banks. Thus, the grounds raised by the assessee are partly allowed for statistical purposes.
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