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2023 (7) TMI 741 - AT - Income TaxDeduction u/s 80P(2)(d) - interest income received on fixed deposits and saving bank accounts maintained with Co-operative Banks - assessee is a registered Co-operative Housing Society - AO denied the deduction on the basis that the Co-operative Bank is covered under the provisions of section 80P(4) - HELD THAT:- We find that in Mavilayi Service Co-operative Bank Ltd. [2021 (1) TMI 488 - SUPREME COURT] while analysing the provisions of section 80P(4) of the Act held that section 80P(4) is a proviso to the main provision contained in section 80P(1) and (2) and excludes only Co-operative Banks, which are Co-operative Societies and also possesses a licence from RBI to do banking business. The limited object of section 80P(4) is to exclude Co-operative Banks that function at par with other commercial banks i.e. which lend money to members of the public. Thus, section 80P(4) of the Act is of relevance only in a case where the assessee, who is a Co-operative Bank, claims a deduction under section 80P of the Act which are not the facts of the present case. No merits in the aforesaid reasoning adopted by the AO in denying deduction under section 80P(2)(d) of the Act to the assessee. Claim of deduction u/s 80P(2)(d) - All Co-operative Banks are Co-operative Societies but vice versa is not true. We find that the coordinate benches of the Tribunal have consistently taken a view in favour of the assessee and held that even the interest earned from the Co-operative Banks is allowable as a deduction under section 80P(2)(d). Even in assessee’s own case for the assessment year 2016-17 [2021 (3) TMI 1425 - ITAT MUMBAI] allowed the deduction claimed by the assessee under section 80P(2)(d) of the Act, by following the decision rendered in assessee’s own case for the assessment year 2015-16 - Decided against revenue.
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