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2023 (4) TMI 209 - AT - Income TaxDeduction u/s 80P - assessee claimed that the interest income should be allowed after adjustment of expenditure - HELD THAT:- In section 80P(2)(a)(i), the assessee is entitled to deduction related interest earned from nominal member. The verification is required related to investment to nominal member as per the activity of the trust in purview of Karnataka Co-op Society Act. We remit back the issue to the AO for adjudication in light of the observation of the bench. The assessee is not more eligible for u/s. 80P related to interest income. But the assessee is eligible for the deduction related to proportionate expenditure on income, which was earned u/s. 57 of the Act. The assessee shall be entitled for proportionate expenditure cost incurred in mobilising the deposit placed in the bank. We fully relied on case of Totgars Co-operative Sale Society Ltd,[2015 (4) TMI 829 - KARNATAKA HIGH COURT] - Related to the submissions of challan for deduction of tax at source is also liable for verification before the lower authority. We remit back the matter to the AO for further verification and allow the assessee for legitimate claim of expenses related to the income earned u/s. 57 -The ground relating to deduction u/s 80P(2)(a)(i) of the Act is remitted back to the file of AO for fresh consideration. Disallowance u/s 40(a)(ia) - Assessee has already filed necessary proof for withholding the taxes at sources, this requires examination at the end of AO. Accordingly, the issue is remitted back to the file of AO for reconsideration.
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