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2022 (4) TMI 1347 - AT - Income TaxDisallowance of deduction u/s 80P(2)(d) on account of interest income - HELD THAT:- As relying on South Eastern Railway Employees’ Cooperative Credit Society Ltd. [2016 (9) TMI 814 - CALCUTTA HIGH COURT] clearly states that such interest income which is earned from other banks and not earned from members of the Society or from deposits with any other cooperative Society no deduction is allowable u/s 80P(2) of the Act. Only any expenditure incurred to earn such income not eligible for deduction u/s 80P(2) of the Act can be claimed. In the instant case, the interest income from banks other than cooperative banks/cooperative Societies/members is ₹ 23,00,239/-. The net profit shown in the profit & loss account is only ₹ 6,96,233/-. Though details of profit & loss account have not been placed on record but even otherwise against the interest income from banks, deduction of ₹ 16,04,006/- has already been claimed by the assessee, there hardly remains any case for the assessee to claim any other benefit. The ld. AO has already allowed deduction of ₹ 50,000/- against the net profit of ₹ 6,96,233/-. The alternative submission of the assessee is that the disallowance should be restricted only to 3.12% being the net profit rate to be applied on the interest income of ₹ 23,00,239/- cannot stand for as the assessee has already claimed an expenditure of ₹ 16,04,006/- against the interest income of ₹ 23,00,239/-. We, therefore, confirm the finding of the ld. CIT(A) sustaining the addition of ₹ 6,46,233/- made by the AO and dismiss the ground nos. 2 & 3 raised by the assessee. For rest of addition assessee had made general submissions and has not placed any material on record to claim that ld. CIT(A) erred in confirming the addition. We, on perusal of the finding of the ld. CIT(A), observe that the assessee had admitted during the course of assessment proceedings that the interest income was understated in the return of income and similarly with regard to the addition of ₹ 8,760/-, the assessee admitted before the AO that there was a difference between the closing bank balance as per bank statement and closing balance as per books of account and the said difference was reconciled and shown in the accounts of the next year. This finding of the ld. CIT(A) remained uncontroverted by the ld. Counsel for the assessee. We, therefore, confirm the finding of the ld. CIT(A) sustaining the addition of ₹ 29,053/- & ₹ 8,760/- made by the AO. Thus, ground nos. 4 & 5 of the assessee are dismissed.
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