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2022 (10) TMI 221 - AT - Income TaxDeduction u/s 80P - disallowance in respect of proportionate interest under Section 80P of the Act claimed by the assessee - HELD THAT:- Jurisdictional High Court in the case of State bank of India Employees’ Co-operative Credit & Supplies Limited [2016 (7) TMI 516 - GUJARAT HIGH COURT] has clearly held that income by way of interest earned by society or investment of idle or surplus does not change its character irrespective of the fact whether such income of interest is earned from a schedule bank or a co-operative bank and thus clause (d) of Section 80P(2) of the Act would not apply in the facts and the circumstances of the present case. The assessee is engaged in the business of providing credit facilities to its members and no other income accrues to the Society in the form of interest from investment and surplus fund to the co-operative bank. The Hon’ble High Court directed the Assessing Officer to allow primary expenses in respect of interest on deposit held with Nationalised Bank to the assessee for computing deduction under Section 80P after examining/verification and affording adequate opportunity to the assessee. The present assessee’s case before us also is identical to that of the issues dealt by the Hon’ble Jurisdictional High Court and, therefore, we direct the Assessing Officer to allow proportionate expenses in respect of interest from deposit held with Nationalised Bank and co-operative bank for computing deduction under Section 80P of the Act after examining/verification and affording adequate opportunity to the assessee. Appeal of assessee is partly allowed for statistical purpose.
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